Missing the Crypto-Stock Wave, Korean Crypto Exchanges Forced to Speculate on "Meme Coins"

Original article fromFour Pillars

Translation / Odaily Golem (@web3_golem)

Editor's Note: On June 16, the Korean exchange Bithumb listed a “meme coin” called Spacecoin. Shortly after, Upbit listed an outdated meme coin, SPX6900. The community largely believes the reason these two major Korean crypto exchanges listed these tokens is their coincidental similarity to SpaceX's ticker symbol, suggesting the exchanges sought to capitalize on the “meme coin” hype to attract trading volume.

Against the backdrop of a weakening crypto market and Korean crypto investors shifting towards stock trading, the Q1 2026 performance of Korean exchanges collectively declined, creating an urgent need for measures to reverse the downturn. However, unlike overseas exchanges that can transform into “everything exchanges” by listing a wide range of tokenized stocks to meet crypto trader demand, Korea classifies tokenized stocks as securities, thus prohibiting crypto exchanges from engaging in such trading. Korean crypto exchanges are also barred from trading crypto futures, derivatives, or spot exchange-traded funds (ETFs).

Korea's regulatory measures, designed to protect investors, have ironically pushed crypto exchanges towards the most speculative corners of the market. With revenue streams and new product lines like derivatives, tokenized stocks, and prediction markets all banned, exchanges, in their quest to boost platform trading volumes, tend to opt for listing high-attention, more speculative “meme” tokens.

Upbit and Bithumb List “Fake SpaceX Stocks,” Shocking the Korean Community

Bithumb and Upbit listed tokens with tickers similar to SpaceX

On the morning of June 16, the hottest topics in the Korean community were Bithumb listing the obscure project token Spacecoin (SPACE) and Upbit listing the meme coin SPX6900. One might ask, isn't this just a regular token listing announcement? What truly sparked the community's reaction was not the listings themselves, but the token names and the timing.

Four days prior, on June 12, SpaceX went public on the NASDAQ under the ticker SPCX. As is well known, SpaceX's IPO set a historic record, and with stock-related topics currently dominating the Korean crypto community conversation, SpaceX became the hottest topic in the space over the weekend.

Consequently, after Upbit and Bithumb's listing announcements, a suspicion began circulating within the community that these exchanges listed tokens with names and tickers very similar to SPCX to ride the hype and generate trading volume. While this connection is merely coincidental, this interpretation not only seems plausible but also reflects the current state of Korean exchanges.

Today, overseas platforms like Coinbase, Binance, and Bybit allow users to trade SpaceX and other foreign stocks directly on the exchange. Due to regulatory restrictions, Korean exchanges cannot offer such products. So, they may have resorted to listing a token that, at the very least, resembles the name SpaceX.

However, this incident shouldn't be dismissed as a mere joke; it perfectly encapsulates the difficult position Korean crypto exchanges face when competing with their overseas counterparts.

The Current State of Korean Exchanges

Overall Performance Decline, Even Incurring Losses

The Q1 2026 performance of Korea's two major exchanges was poor.

Upbit Q1 2026 Performance. Source: FSS DART

According to the quarterly report submitted via the Financial Supervisory Service's DART system on May 15, Dunamu, which operates Upbit, reported consolidated revenue of 234.6 billion KRW, down 54.6% year-on-year. Operating profit plunged 77.8% to 88 billion KRW, and net profit plummeted 78.3% to 69.5 billion KRW. Upbit's fee revenue fell by 55.2% to around 200 billion KRW, while operating costs rose 22% over the same period, squeezing profit margins.

Bithumb Q1 2026 Performance. Source: FSS DART

Bithumb's situation was even more severe. First-quarter revenue fell 57.6% to 82.5 billion KRW, operating profit tumbled 95.8% to 2.9 billion KRW, and the company posted a net loss of 86.9 billion KRW, marking its second consecutive quarter of net loss. The direct cause was a sharp 87% decline in fee revenue due to shrinking trading volume. Additionally, fines totaling 36.9 billion KRW from the Korea Financial Intelligence Unit (KoFIU) for violating the Act on Reporting and Using Specified Financial Transaction Information, and a six-month partial business suspension order, were also reflected in Q1 results.

The biggest problem for Korean exchanges is that their revenue structure is almost entirely dependent on trading fees. Transaction fees account for approximately 97.5% of Dunamu's revenue and 99.99% of Bithumb's revenue, making fees practically synonymous with total revenue. However, this structure is less a result of any negligence in exchange operations and more a product of the regulatory environment (detailed below) facing Korean crypto exchanges.

Limited Business Scope, Only Able to Support Crypto Spot Trading

In reality, the business activities allowed for Korean crypto exchanges are largely confined to crypto spot trading. Entry into other areas is mostly blocked, whether through explicit regulations or tacit avoidance. Below is a list of businesses Korean crypto exchanges are prohibited from conducting:

• Tokenized Stocks: In June 2026, the Financial Services Commission (FSC) and the Financial Supervisory Service (FSS) began classifying tokenized stocks as securities, not virtual assets. Regardless of the issuance form, securities are governed by the Capital Markets Act; under the Electronic Securities Act, only licensed electronic registration institutions can perform electronic rights registration. If a crypto exchange that is not such an institution issues or distributes security-type tokens, it constitutes unlicensed business. In other words, tokenized stocks, which are rapidly developing overseas, are structurally prohibited assets for Korean exchanges, and this situation is unlikely to change.
• Futures and Derivatives: Korean crypto exchanges can only offer spot trading and cannot provide derivatives like perpetual futures or options to domestic users. This is less an explicit legal prohibition and more a shadow cast by a past attempt. Coinone, one of Korea's top five exchanges, operated a margin trading service with leverage up to 4x starting December 2016 for about a year. Towards the end of 2017, with the onset of government regulatory measures and police investigations, the service was completely shut down. In 2018, police treated the service as gambling for operating without financial regulatory approval, referred CEO Cha Myung-hoon and others to prosecutors on charges of running a casino, and even arrested 20 users with trading volumes exceeding 3 billion KRW on gambling charges. The case concluded three years later in 2021 with a no-prosecution decision due to insufficient evidence. Since then, no Korean crypto exchange has been involved in leveraged or futures trading.
• Implicit Avoidance under Self-Regulation: Korean crypto exchanges are subject to self-regulation by the Digital Asset Exchange Alliance (DAXA), composed of the top five KRW exchanges. Its listing review standards include de-identification causing opacity, potential for securitization, and potential for money laundering. These standards effectively exclude privacy coins emphasizing anonymity and lead exchanges to avoid listing tokens that might be considered securities. For similar reasons, assets that could spark securities or gambling controversies, such as exchange tokens or prediction market tokens, are rarely seen on Korean exchanges.

In summary, nearly all new frontiers that overseas exchanges are expanding into – such as crypto derivatives, tokenized stocks, privacy coins, and prediction markets – are restricted for Korean exchanges.

Korean Exchanges Have Fallen Behind in the Global Competition

Have Korean Exchanges Lowered Their Listing Standards?

Recently, the community has accused Upbit and Bithumb of relaxing their listing review standards. The table below provides a complete comparison of tokens listed by Coinbase, Upbit, and Bithumb in 2026:

Tokens listed by Coinbase, Upbit, and Bithumb in 2026. Source: Four Pillars (@c4lvin)

In terms of the number of listed tokens, Coinbase leads. Coinbase has listed many assets not available on the two Korean exchanges, and a significant portion of these offers not only spot trading but also futures trading, providing trading opportunities earlier than other platforms. Looking purely at frequency and timing, Coinbase is actually more aggressive.

In 2026, a considerable number of new KRW tokens listed on Upbit had previously been listed on Bithumb, such as Bittensor (TAO), Internet Computer (ICP), Ether.fi (ETHFI), io.net, dogwifhat, Spark (SPK), and Babylon. Most of these tokens did not have high trading volumes on Bithumb. They were not newly issued assets but tokens that had existed in the market for a while, only being added to Upbit's platform after their initial listing elsewhere. This might make Upbit's listings seem less fresh.

The real reason for this perceived decline in token quality is not a lowering of the standards themselves but the diminishing effect of listings on trading volume. In an environment where the trading volume generated by a single token listing quickly dries up and new assets worthy of listing become increasingly scarce, Upbit maintains its listing pace by listing tokens already present on Bithumb.

Ultimately, the complaints from Korean users are less about a specific token name and more rooted in the perceived difference in convenience compared to other markets that offer newer products like tokenized stocks.

Korean Exchanges Excluded from the SpaceX Listing Feast

Meanwhile, major overseas exchanges are moving in the opposite direction. They are striving to break free from the limitations of virtual assets and build so-called “everything exchanges” – a single application where all assets can be traded.

The most prominent example is Coinbase. In its Q4 2025 shareholder letter, Coinbase stated that beyond cryptocurrencies and derivatives, it had begun enabling stock and ETF trading within its app, offering early access to around 3,000 assets, aiming to integrate traditional and digital assets into a unified portfolio experience. The letter also highlighted that Coinbase became the first in the industry to offer 24/7 US perpetual futures products, thereby increasing its market share in derivatives.

Binance's approach was more direct. As of June 1, 2026, Binance opened US stock trading to eligible users, allowing direct trading of over 7,000 US-listed stocks and ETFs. Additionally, Binance launched bStocks, which tokenize US stocks on a 1:1 basis, settled in stablecoins, withdrawable to user self-custody wallets, and supporting 24/7 trading.

Bybit joined the xStocks coalition and listed tokenized stocks created by a regulated Swiss issuer. These price-tracking tokens are backed by real stocks and trade 24/7 using stablecoins.

In short, overseas crypto trading platforms have made tokenized stocks a key promotional item. The difference in the trading environment between Korea and abroad was most starkly illustrated during the SpaceX IPO. For overseas exchanges, this IPO served as a test of tokenized stock competitiveness, with pre-market futures products and tokenized stocks being launched.

Within 24 hours of the SpaceX-related products launching, the total trading volume across the entire cryptocurrency market reached approximately $9 billion, with Binance alone accounting for $5.6 billion.

In contrast, Korean crypto exchanges had no part in this feast. Tokenized stocks, perpetual contracts, or any product tracking SpaceX were not permitted for trading within Korea. While major global exchanges conducted billions of dollars in trades around the same hot topic, Korean crypto exchanges had no channel to participate.

Korean Exchanges Are Choking Under Regulatory Pressure

For an exchange that cannot compete in product variety with the rest of the world, the only remaining battlefield is the crypto market itself. As Korean exchanges' revenue effectively depends on spot trading fees, and with no ability to list derivatives or stocks, the only way to increase trading volume is to list tokens that can capture investor attention at the right moment.

Korea's strict regulation of crypto exchanges was intended to protect investors. It treats leveraged trading as gambling and prohibits it. It filters out security-type tokens with opaque rights structures, and excludes assets easily used for money laundering or price manipulation from listing reviews.

However, as this protective mechanism systematically strips away the exchanges' revenue streams and product lines, their only remaining tool is listing crypto spots. And the more the crypto market's trading volume shrinks, the more Korean exchanges lean towards listing assets that attract higher attention and are therefore more speculative. Protection at the product stage ultimately fuels the influx of speculative assets at the listing stage. The recent listing of tokens with tickers similar to SpaceX by the two major exchanges is a microcosm of this trend.

A deeper issue is that even this protective mechanism is not entirely effective. Korean investors wanting to buy perpetual contracts or tokenized stocks will not easily give up their demands; they will simply turn to overseas platforms like Binance, Bybit, and Hyperliquid.

In other words, Korean regulation itself does not eliminate investors' high-risk trading; it merely pushes high-risk trading outside the markets under Korean authorities' supervision. When taxation and the Crypto-Asset Reporting Framework (CARF) take full effect in 2027, the scale of this offshore trading will become evident from the data. Ultimately, investors take on speculative risks anyway, lose domestic regulatory safeguards, and Korean exchanges forfeit the revenue these trades would have generated.

This structure also makes Korean exchanges themselves fragile. With a single product line, almost all revenue coming from trading fees, they are fully exposed to trading volume cyclicality. While Coinbase diversifies its revenue into custody, stablecoins, tokenized stocks, and derivatives to cushion market downturns, Korean exchanges must weather the same cycles relying solely on a single product. As this gap accumulates quarter by quarter, it eventually manifests as differences in investment capability and product competitiveness, which in turn become apparent again, much like the perceived convenience gap felt by domestic users.

Of course, the Korean government is actively pushing forward crypto regulation. A series of initiatives – the second phase of the Digital Asset Basic Act, the institutionalization of Security Token Offerings (STOs), approval of corporate trading, issuance of KRW stablecoins and spot ETFs – are all scheduled to kick off in 2026, demonstrating the government's commitment. However, even if these new regulations are eventually implemented, they might not be operated by existing crypto exchanges but entrusted to licensed entities like securities firms and electronic registration institutions.

Therefore, the ongoing convergence is not crypto exchanges transforming into securities firms, but securities firms and banks acquiring stakes in crypto exchanges and incorporating them into the same system. In 2026, Hanwha Investment & Securities increased its stake in Dunamu to 9.84%, becoming the third-largest shareholder; Hana Financial Group holds a 6.55% stake; Samsung Securities, Samsung Card, and Samsung SDS hold a combined 4% stake. Korbit was acquired by Mirae Asset Group; Korea Investment & Securities signed a strategic equity investment agreement to acquire a 20% stake in Coinone, becoming its third-largest shareholder. Such alliances are rapidly increasing as financial regulators adopt a cautious stance towards the separation of finance and crypto and lean towards relaxing related restrictions.

Is it likely that Korea will allow crypto exchanges to evolve into “everything exchanges” like abroad? The possibility is extremely slim.

However, this article does not advocate for the immediate removal of regulations. Instead, it suggests that a protective framework designed for a bygone era, as the market rapidly trends towards asset integration, is now creating significant hidden costs. Korean crypto exchanges operating under such harsh conditions will inevitably pass these costs onto users, especially during bear markets like the current one, ultimately leading to the resurgence of fleeting, high-demand “meme coins” that create more victims, just as we see today.