Bitcoin has been less volatile than South Korea’s stock market in recent weeks.
According to Protos, South Korea’s benchmark KOSPI has swung an average of 3.8% a day since the start of June, more than double BTC’s 1.7%. On a 12-month basis, KOSPI’s annualized volatility has climbed to 57%, compared with 47% for bitcoin.
One analyst told Protos, “Compared to KOSPI, BTC has become a low-volatility asset. SK Hynix and Samsung Electronics showed volatility of 90% and 78% respectively, an extreme level previously observed only in thematic stocks.”
Investors have pushed SK Hynix and Samsung Electronics into the latest AI-stock frenzy. Both companies make hardware tied to the boom in AI chatbots and coding tools including Gemini, Claude, ChatGPT, and Grok.
Even after a sharp pullback in recent days, KOSPI remains the top-performing stock market among major economies in 2026, still up about 60% on the year despite losing roughly a quarter of its value since June. The index went from 3,033 to 9,386 and then back into a bear market within 11 months.
KOSPI has also triggered seven circuit-breaker halts so far this year, surpassing 2008.
“The memory shortage is real in the short to medium term, Samsung $SSNLF and SK Hynix $SKHY sit at the center of it, and the index may…”
That comment appeared in a July 16 post from Inferam.
KOSPI swings through repeated halts
KOSPI closed at a record 9,114.55 on June 22. One day later, it fell 9.99%, one of the largest single-day declines in the index’s history.
Monday brought another sharp drop. The index plunged 8.95%, broke through 7,000, and triggered its seventh 20-minute market-wide circuit breaker of 2026.
A market-wide circuit breaker stops all trading in listed stocks for 20 minutes after an 8% drop. A more common program-trading halt, also known as a sidecar, pauses only certain programmatic orders after sharp moves in futures.
By Wednesday, the move had reversed. KOSPI rebounded 6.24% to 7,284.41. On Thursday, it gave back most of that gain. The index fell 6.4% to 6,820, setting off its 37th program-trading halt of 2026, a five-minute pause intended to restore order. Protos noted that the Thursday crash was not even the index’s worst session of the week.
The Bank of Korea added to the pressure by raising rates 25 basis points to 2.75%, its first increase since January 2023.
Over the same stretch, BTC traded comparatively calmly in the $60,000s.
Two AI-linked stocks dominate the index
Protos said the index has a structural concentration problem. Samsung Electronics and SK Hynix account for half of KOSPI’s market value. Exposure to those two companies is then amplified through funds, derivatives, and leveraged products.
The timing mattered. SK Hynix joined the $1 trillion club in the same session that pushed KOSPI up 95% for the year. Investors looking to magnify gains during the rally piled into newly launched 2X single-stock ETFs, which became central to market activity within weeks.
Those leveraged funds generated 212 trillion won in volume in June alone, more than a quarter of the country’s ETF turnover.
Then the unwind began. Their combined assets fell 41% between July 1 and July 13, dropping from 15.9 trillion won to 9.3 trillion won.
Bloomberg reported that one Hong Kong-listed fund tied to SK Hynix had grown so large that it became “the tail wagging the dog,” exerting more influence on SK Hynix volatility than the company’s common stock itself.
Retail leverage draws a regulatory response
South Korea’s president said at the Korea Exchange in June 2025 that he wanted to “make investing in stocks a primary mode of investment on par with real estate.” Retail investors followed with borrowed money.
Reuters quoted a 24-year-old trader who turned 10 million won into 300 million won on margin as saying, “Just as it went up explosively, it went down explosively.”
Data from the Korea Financial Investment Association showed brokers liquidated 1.12 trillion won of margin-called stock in June, the highest monthly total this year.
A widely shared Bull Theory post said 1.2 million “accounts” were hit with margin calls, roughly equivalent to one in 30 working-age adults. Protos added that no regulator has published account-parsing figures, so it is not possible to say precisely how many individual people received margin calls.
The market slump has also spilled into the real world. Protos reported this week that a stock-trading YouTuber was stabbed in Busan after the crash.
Seven weeks after approving the products, and after the financial watchdog’s chief said the rollout had been too hasty, the Financial Services Commission on Thursday halted new listings of 2X single-stock ETFs until markets stabilize. It also tripled minimum deposits to 30 million won, or about $20,300, effective August 5.
Exness strategist Inki Cho called the step “overdue” and said, “This is a correction of a known policy error.”
Bitcoin stays relatively calm
While Korean equities lurched between record highs and steep losses, BTC did comparatively little over the same period. It traded near $64,000 on Thursday, roughly half below its October 2025 peak of about $126,000.
Protos also said CME’s implied volatility gauge for bitcoin came within three points of a 12-month low last week.