[THE INVESTOR] Kakao-backed Upbit has outpaced its crosstown rival and the nation’s largest cryptocurrency exchange Bithumb in terms of daily Bitcoin trading, according to data from the two firms on Dec. 27.
As of 3:30 p.m., 46,286 Bitcoins were trading at Upbit, which compared to 41,176 at Bithumb. At the same time, the figure for Bitfinex, the world’s largest Bitcoin exchange, was 54,730.
Bithumb, established in 2014, is still the market leader with monthly transactions worth 56 trillion won and more than 2.5 million active users. But the two-month-old Upbit is fast catching up with the No. 1 player that is reeling from several hacking attacks in recent months.
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Upbit said last week its daily Bitcoin trading volume has reached 5 trillion won on average, becoming one of the largest cryptocurrency exchanges globally.
Upbit’s trading fee of 0.139 percent is slightly cheaper than 0.15 percent of Bithumb.
Unlike Bithumb that trades only a dozen of cryptocurrencies, Upbit trades more than 100 currencies largely due to its partnership with US-based Bitrex, the world’s third largest Bitcoin exchange. Upbit uses its own system for trading in Korean won while depending on the US partner’s platforms for other currencies.
Some critics are questioning Upbit's close ties with Bitrex for not joining a local association of 14 major Bitcoin exchanges, including Bithumb, Coinone and Korbit, which recently unveiled voluntary measures to cool down the recent trading frenzy here.
Still, expectations are growing about Upbit’s further growth among investors after Kakao founder Lee Seok-woo recently joined the firm as CEO hinting at a possible partnership with Kakao in future business expansion.
Kakao and its venture capital firm K Cube Ventures own 8.84 percent and 20 percent in Dunamu, the Upbit operator, respectively. Kakao shares have recently been bullish partly on Upbit’s strong performance.
By Lee Ji-yoon (firstname.lastname@example.org)