Dunamu profit drop hits Upbit amid cooling crypto trading volumes
South Korea’s Dunamu, operator of the Upbit exchange, reported a sharp profit drop as the crypto market cooled. In Q1, its operating profit fell 78% year-on-year to 88 billion won (about $59 million). Consolidated sales declined 55% year-on-year to 235 billion won. Net profit also fell 78% to roughly 70 billion won.
The company said the profit drop was driven by lower virtual-asset trading volumes tied to the global economic downturn. With transaction fees accounting for 97% of revenue, weaker market activity also reduced customer deposits. Deposits were about 5 trillion won in Q1, down 11% from end-2025.
Separately, Dunamu received a 1 trillion won ($670 million) investment from Hana Financial Group. Hana Bank will buy a 6.55% stake from Kakao Investment, becoming Dunamu’s fourth-largest shareholder. The two firms also plan to cooperate on a won-based stablecoin infrastructure.
Strategically, Naver Financial (Naver Corp. subsidiary) agreed in November 2025 to acquire Dunamu via an all-stock deal valued at about $10 billion, with an IPO reportedly under consideration after completion.
Overall, the profit drop highlights how fee-heavy crypto exchanges can quickly feel earnings pressure when trading volumes slow.
Bearish
Dunamu’s reported 78% Q1 operating profit drop is a direct signal that spot trading activity is weakening. Because transaction fees make up 97% of revenue, lower volumes quickly translate into lower earnings and lower customer deposits—an exchange-level “demand” indicator that often correlates with softer market momentum.
In the short term, traders may take this as confirmation that the current rate of crypto activity is slowing, which can increase caution around risk assets and reduce leverage demand. Historically, fee-heavy exchange earnings disappointments during macro slowdowns have tended to coincide with choppier price action and more conservative positioning.
In the long run, the Hana Bank investment and potential stablecoin-infrastructure cooperation are supportive in terms of institutional rails and product diversification, but they do not offset the immediate earnings hit from weak trading volumes. If volumes stabilize, sentiment could improve; if volumes keep falling, continued margin pressure would likely reinforce a bearish backdrop for the sector.
Overall, the earnings/profit drop is a near-term negative for market sentiment, outweighing the longer-term strategic investments.