South Korea Web3 Market Q1 2025 Report: From Liquidity Export to Industrial Ecosystem

Overview

In the first quarter of 2025, the South Korean Web3 market will reach a turning point, transitioning from a "Liquidity export" of global projects to a structured self-sustaining industrial ecosystem. The Financial Services Commission has relaxed regulations on corporate accounts, allowing institutional entities to gradually conduct cryptocurrency transactions through corporate accounts. Global projects such as Avalanche, TON, Ripple, and Solana are actively establishing a long-term presence in South Korea, focusing on developer community building and hosting hackathons.

Transformation of the Web3 Market in South Korea

Despite active participation from retail investors and ample Liquidity, the institutional infrastructure development in the South Korean Web3 market has made limited progress. Regulatory efforts prioritize investor protection over ecosystem development, delaying broader industry growth. Major obstacles include restrictions on corporate accounts' association with cryptocurrency exchanges and the high entry barriers for obtaining a Virtual Asset Service Provider (VASP) license.

The market development in the first quarter of 2025 shows that South Korea has the potential to shift from a speculation-driven market to an industry revitalization-oriented market. Recent regulatory improvements signify substantial progress in structural reforms. Global projects are steadily building a local ecosystem with the support of an expanding builder community and emerging new initiatives.

Institutional Progress: Opening Up Cryptocurrency Trading for Corporate Accounts

On February 13, 2025, the Financial Services Commission announced the "Roadmap for Corporate Participation in the Cryptocurrency Market," which will gradually lift the corporate cryptocurrency trading restrictions that have been in place for seven years:

1. Phase One (starting Q2 2025): Open accounts to law enforcement agencies, non-profit organizations, and cryptocurrency exchanges, limited to asset liquidation purposes.
2. Second Phase (Starting in the second half of 2025): Allow public companies and registered investment companies and other professional investors to trade.
3. Phase Three (Medium to Long Term): Fully open the market to ordinary enterprises.

This development lays a legal foundation for South Korean enterprises to conduct Web3 business, is expected to enhance market stability, and promote diversification of financial services. However, the phased relaxation of regulations may lead to supply and demand imbalances, putting downward pressure on price formation. As publicly listed companies and institutional investors enter the market, the government's efforts to ensure tax revenue are expected to strengthen. The conservative risk management of institutional investors may lead to concentrated holdings of Bitcoin, raising concerns over the decline in the activity of the altcoin market.

Strategic Layout of Global Web3 Projects

Many international teams are actively recruiting Korean talent and establishing substantive cooperation, demonstrating a strategic shift from superficial marketing to building a sustainable, builder-led local ecosystem. The Avalanche and TON foundations support local Korean teams in constructing the ecosystem. The hackathons hosted by XRPL Korea (Ripple) and Superteam Korea (Solana) have become key turning points in the Korean Web3 ecosystem.

These developments mark a new momentum phase for the Web3 sector in South Korea. Based on this, Korean projects are expected to deliver substantive innovations to the global stage in the coming years.

Conclusion

In the first quarter of 2025, South Korea's Web3 market will undergo a key transformation, shifting from an investment-driven environment to a mature industrial ecosystem. Regulatory progress lays the foundation for structured market participation, while ongoing ecological construction efforts by global Web3 projects support South Korea's market in achieving a long-term growth position. The Bank of Korea's central bank digital currency (CBDC) "Han River Project" successfully completed its first retail user real-world transaction, and major commercial banks have begun to jointly explore the issuance of a Korean won stablecoin.

These developments clearly demonstrate the evolution of South Korea's Web3 sector towards a sustainable industrial ecosystem. After years of regulatory constraints and structural inefficiencies, South Korea is entering a new stage characterized by policy synergy, institutional participation, and the initial emergence of industrial-level growth.