The bear market in cryptocurrencies and strict regulations are causing the closure of small and medium-sized cryptocurrency exchanges in Korea. According to The Korea Daily, only three out of 22 such exchanges in Korea are actively trading, with significantly lower transaction volumes compared to the major exchanges that allow KRW trading. The lack of direct KRW investment on these smaller exchanges results in higher fees and decreased trading volume, leading to revenue drops. Many small exchanges tried to become KRW exchanges but failed to meet regulatory requirements. Eight exchanges have announced shutdowns, and more are expected to follow due to compliance burdens. Some exchanges have already closed their websites or ceased trading due to operational issues. The inability to compete with global exchanges and the high costs of server maintenance and labor are major challenges. Kim Kyu-jin of Tiger Street Research notes that the strict regulations and lack of real-name accounts make it difficult for these exchanges to sustain business in Korea.

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