South Korean crypto firms post sharp earnings declines as Polymarket faces local ban

News Editor

2026-08-18 13:18:41

South Korea’s crypto sector is under pressure on two fronts: weaker exchange earnings and tighter enforcement against prediction markets. In the first half of the year, Bithumb and Dunamu, the parent company of Upbit, both reported steep drops in revenue and operating profit. According to figures cited by The Block, Bithumb’s operating profit fell 83% year over year to 14.9 billion won, while revenue dropped nearly 49% to 168.8 billion won and the exchange posted a net loss of 108.7 billion won. Dunamu reported first-half operating revenue of 408.1 billion won, down 49% from a year earlier, and operating profit of 111.5 billion won, down almost 80%. Dunamu said the weaker results stemmed from a contraction in liquidity across the global digital asset market, which in turn weakened investor sentiment. At the same time, South Korea’s Media and Communications Commission moved to block Polymarket, saying the platform’s yes-or-no contract structure amounts to illegal gambling under the Criminal Act and the National Sports Promotion Act. Polymarket argued that it does not manage user funds, has removed Korean-language services, and does not support the South Korean won, but the commission said those technical features do not exempt it from domestic law.

South Korean crypto exchanges Upbit and Bithumb posted sharply weaker first-half results as the country’s digital asset sector continued to struggle. At the same time, South Korea has banned prediction market Polymarket after determining that its operations amount to illegal gambling.

Bithumb and Dunamu report steep declines

According to The Block, Bithumb recorded operating profit of 14.9 billion won ($11 million) in the first half of the year, down 83% from 90.1 billion won ($64 million) a year earlier. Operating revenue came in at 168.8 billion won ($120 million), almost 49% lower than last year’s 329.2 billion won ($233 million).

Bithumb also posted a net loss of 108.7 billion won ($77 million) this year.

Dunamu, the parent company of Upbit, reported a similar decline in operating revenue. The company made 408.1 billion won ($289 million) in the first half, down 49% from 801.9 billion won ($568 million) last year. Operating profit was 111.5 billion won ($79 million), an almost 80% drop from 549.1 billion won ($389 million) a year earlier.

Dunamu said, 「The recent decline in performance is attributed to a contraction in liquidity across the global digital asset market, which has led to a weakening of investor sentiment.」

Polymarket blocked in South Korea

South Korea’s Media and Communications Commission concluded that Polymarket’s operations constitute illegal gambling and moved to ban the platform. The regulator said Polymarket crossed an information threshold classified as gambling under the Criminal Act and the National Sports Promotion Act.

South Korean crypto firms post sharp earnings declines as Polymarket faces local ban 3

It said the platform’s yes-or-no contracts encourage speculative behavior in which winnings depend on events outside users’ control.

Polymarket argued that it does not manage user funds, that it removed Korean-language services, and that it does not support South Korea’s won fiat currency.

The commission responded, 「Technical features or service methods cannot exempt a platform from domestic legal compliance. Since Polymarket provides a real illegal gambling environment to domestic users, access blocking is unavoidable to protect them.」

Other references in the report

Protos also noted that South Korea’s KOSPI erased more than Bitcoin’s market cap in 29 days.

The article additionally pointed to a separate report saying American Indian tribes want Kalshi and Polymarket off their land.

This article was originally published by Bit.Fan. For more cryptocurrency news and market insights, visit www.bit.fan.

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