Even in today’s bear market, UPbit, Korea’s largest cryptocurrency exchange, has posted $100M in profit for Q3 of 2018. With the crypto market and trading volumes on the decline, it’s a wonder that UPbit is experiencing such prosperity, especially in relation to their closest competitor, Bithumb. Now, we say “closest” generously. Bithumb is Korea’s second largest exchange, though they came in at 39$ in profit for the same quarter. Clearly, UPbit is leading the charge by a significant margin.
The Closest Competitor: Bithumb
Bithumb has not always this far behind, though. In fact, just last year Bithumbs annual profit was reportedly $400 million. Unfortunately, Bithumb was subject to a $40 million hack in June. The security breach lead to a month-long dead period for the exchange. Though Bithumb reimbursed the lost user funds, they were still hit with a mass user exit. It is speculated that Bithumb would be neck in neck with UPbit in terms of profit, has it not been for the security breach. The breach resulted in lost trust and fear amongst potential users. Therefore, Bithumb has fallen substantially in the race for Korea’s largest crypto exchange.
Korea’s Biggest Exchange
It is important to note that UPbit has only been operational since 2017. In this case, their profitability is quite astounding. With their profit at $100M and corporate holdings at $1.2B, it’s no wonder they are raising some eyebrows in the crypto community. In fact, just two months again, the South Korean government raided UPbit’s offices. The raid included seizing and searching computers, hard drives, and everything you can imagine. Though the searches concluded and no incriminating evidence was produced.
UPbit is the brainchild of Korean internet giant, Kakao. Recently, the key player in the Korean tech industry launched KakaoPay which has already gained 90% of Korea’s fintech market share. Many believe that Kakao is responsible for UPbit’s immense success. This may be the case, as Kakao provides industry credibility, notoriety, and trust to the UPbit brand.
UPbit is enjoying massive prosperity and proving that success in the crypto industry is still possible, even in the face of today’s market. Additionally, the massive gap between UPbit and Bithumb prove the fickle nature of the market. When security is compromised, people will flee. Plain and simple.