Investors Fleeing the Stock Market in South Korea Flock to Crypto: Surges 1,426% in a Single Day

While sharp declines in South Korea’s KOSPI stock exchange drove investors toward the cryptocurrency market, trading volume on Upbit, the country’s largest exchange, saw a massive increase of 1,426% in a single day.

South Korean financial markets are witnessing a sharp divergence between the traditional stock market and crypto assets. As of July 14, while selling pressure on tech stocks intensified, trading volume on the Upbit exchange reached record levels as investors shifted their course toward digital assets.

KOSPI index lost 4% during the day, retreating to the 6,534.34 level. In particular, losses exceeding 7% in the shares of tech giant SK Hynix were among the main factors triggering market panic. This sharp downward trend reflected in price charts and the dominance of red candles indicate a significant capital outflow from the stock market.

Liquidity Flow from the Stock Market to Crypto

According to data shared by the Korea Economic Daily, approximately $286 million worth of forced liquidations occurred in the stock market between July 1 and July 10. The liquidation of $142.2 million in positions on July 9 and $81.6 million on July 10 alone caused investors to distance themselves from traditional markets. The liquidity released following these liquidations appears to have shifted toward cryptocurrencies.

CoinGecko data revealed that the 24-hour trading volume on Upbit, South Korea’s largest cryptocurrency exchange, reached $4.27 billion. This extraordinary increase of 1,426.2% compared to the previous day proves that stock market investors are opting for cryptocurrencies for risk aversion or to seek new opportunities. This volume explosion, which contrasts with the downward charts of tech stocks, shows that investor behavior in the region is changing rapidly.