By Dou Wanle
Seoul, July 13, 2026. South Korea’s KOSPI fell 8.95% in one day, marking the seventh circuit breaker event of the year. SK hynix, widely seen in South Korea as a flagship national stock, dropped 15.37% in a single session, its steepest fall in nearly two decades. Samsung Electronics also lost more than 10%.
More than 1.2 million leveraged accounts received margin calls, and brokerage systems automatically liquidated between 320,000 and 460,000 accounts. Of those hit by forced liquidations, 62% were investors in their 20s and 30s. Some lost money set aside for a home down payment, while others had borrowed to buy stocks. The article also cites a case in Busan where a man in his 20s, after losing money on a stock tip from a YouTuber, stabbed the creator.
Scenes like these used to be associated with crypto crashes. PANews argues that they are now reappearing in South Korea, the United States, and Japan as the tech-stock trade unwinds. The real change, the article says, is not just in price swings but in how assets are being priced: narrative is overtaking valuation, leverage is amplifying emotion, and social media is pushing consensus to extremes at high speed.
From crypto desks to stock trading screens
After the selloff, crypto traders who had shifted into equities posted losses online. One phrase kept showing up in comment sections: “Welcome back to your original family.” In this context, the “original family” means crypto.
The article places that migration in the second half of 2025 and the opening months of 2026. A group of long-time crypto KOLs and experienced traders had grown disillusioned with the market. Bitcoin was moving sideways, volumes were weak, and meme coins had worn people down. Many concluded that the market had lost its appeal and turned their attention to U.S. equities.
At the time, the move looked rational. Stocks came with revenue, earnings, financial statements, and regulation by the U.S. Securities and Exchange Commission, or SEC. Compared with crypto projects that lacked cash flow and relied heavily on consensus pricing, equities looked more mature and safer.
What moved across markets was not only capital but also trading behavior. In crypto, traders were used to chasing new narratives, hunting for high-beta names, using leverage, and rotating positions quickly in response to social media sentiment. Once they entered the stock market, the method barely changed. Only the instruments did: tokens were replaced by AI names, memory-chip makers, and leveraged ETFs.
Storage stocks soon became a crowded trade. The logic was straightforward: AI servers needed more high-bandwidth memory, HBM supply was tight, memory prices were rising, and Micron, Samsung Electronics, and SK hynix were seen as the clearest “picks and shovels” names. The article notes that a widely repeated line from “Sun Ge” — “there is always a shortage of storage” — became part of the market script.
Some crypto KOLs began discussing U.S. equities, memory cycles, and AI capital spending instead of tokens. Products such as 2x long SK hynix were treated by some investors as a more efficient way to express the same view than buying common shares. That worked until the market turned in July.
Some tech stocks have been falling faster than bitcoin
The article compares drawdown speeds across assets. Bitcoin took 268 days to fall by half from its peak. Silver took 169 days for a similar retracement. By contrast, SanDisk fell about 55% in 36 days, and SK hynix dropped about 53% in 34 days.
The point is not that bitcoin has become safe. The point is that some equities have recently been unwinding even faster than crypto. PANews says this is what makes the current cycle unusual. Investors used to worry that bitcoin could swing wildly in a matter of days while stocks adjusted more slowly through changes in earnings and valuation. Now, some tech names are completing a full boom-and-bust sequence in less time than digital assets.
Charles Schwab data cited in the article shows bitcoin’s historical volatility at about 42% in 2025, with a maximum drawdown of roughly 32%. Over the same period, Tesla’s volatility was about 63% with a 48% maximum drawdown, while Nvidia showed about 50% volatility and a 37% maximum drawdown.
That does not turn bitcoin into a low-risk asset. It does suggest that some large-cap tech stocks have been more volatile. The article adds that Bitwise, in its 2026 outlook, even predicted bitcoin’s overall volatility could remain below Nvidia’s. The result is an odd reversal: bitcoin is looking more like a tech stock, while some tech stocks are starting to trade more like bitcoin.
When narrative becomes the valuation anchor
Crypto traders have long said that trading tokens is really about trading narratives. PANews says global tech equities in 2026 are putting that idea into practice.
AI is not an empty story. Nvidia, Microsoft, Google, and large cloud companies have real revenue and are spending real money on data centers. But the gap between “AI will create value” and “any company connected to AI is worth buying at any price” is large. In the hottest stretch of the rally, the article says, the market skipped over that gap.
AI servers, optical modules, memory chips, data centers, power equipment, and even nuclear-energy companies could surge if they were placed inside the AI supply-chain story. Businesses were still being planned and orders had not always landed, yet prices were being set as if the best possible outcome years from now was already in hand.
In South Korea, the story was framed as “AI semiconductors are tied to the national fate.” As the KOSPI kept pushing to new highs, more families opened brokerage accounts for underage children and treated shares of Samsung Electronics and SK hynix as long-term gifts.
Mainland China saw a similar concentration. In the first half of 2026, the TMT sector reached a market value of 41.78 trillion yuan, or about 31.45% of the A-share market’s total capitalization. On some trading days, technology stocks accounted for nearly half of the entire market’s turnover.
In the United States, pricing has revolved around a small group of mega-cap tech names for an extended period. Once index gains depend more and more on just a few companies, and funds, options traders, and retail investors are all crowding into the same names, portfolios that appear diversified are in fact expressing the same AI trade.
The article compares that pattern with earlier crypto cycles. Dogecoin’s 2021 surge was not driven by a technical breakthrough; it was driven by a tweet from Elon Musk. In 2026, the rally in tech stocks was not powered by every company suddenly posting explosive results; it was powered by ChatGPT convincing the market that “AI will rewrite everything.”
Distribution channels have also changed. Stock ideas once came mainly from earnings reports, research notes, and institutional roadshows. Now, more investment decisions are coming from YouTube, X, short-form video, and paid groups.
Detailed company research gets reduced to a few slogans: time will prove the need for compute and optical modules, AI compute will always be in short supply, and so on. Social-media algorithms do not reward caution. Overnight wealth does. Stories about options doubling quickly, office workers reaching financial freedom by concentrating in storage stocks, or traders earning several years’ salary in a few months with leveraged ETFs spread much faster.
Price charts then become the marketing material. The article says large numbers of mothers and older retail investors brought household savings into the market, and some people even sold homes to buy stocks, echoing the years when students dropped out and went all in on Web3.
How leverage turned a selloff into a cascade
PANews argues that the most dangerous feature of crypto is not volatility on its own, but volatility combined with leverage. In its view, global equity markets in 2026 are replaying that same setup.
On May 27, 2026, the Korea Exchange approved 16 single-stock 2x leveraged ETFs tied to names including Samsung Electronics and SK hynix. Retail traders piled in. From approval through mid-July, South Korean retail investors posted cumulative net purchases of 14 trillion won, roughly 64 billion yuan. Over the same period, foreign investors bought only about 2 trillion won.
The article says these products contained several dangerous structural features. They rebalance daily, which means the more violent the swings, the larger the net-asset-value drag. If a stock drops 10% and then rises 11.1%, the stock returns to its starting point. A 2x leveraged product tracking it would fall 20% and then rise 22.2%, still ending with a loss of about 2.2%.
In a fast selloff, the effect becomes harsher. To maintain target leverage, the product has to cut exposure after declines. Selling pushes the underlying lower, which triggers more deleveraging, stop-losses, and margin pressure.
Goldman Sachs later said the “rapid deleveraging” in these products was the main reason behind the KOSPI’s unusual intraday volatility, with 62% of institutional net selling tied to ETF-related liquidations.
Two months later, South Korean regulators urgently halted all new single-stock leveraged ETF listings. The minimum margin requirement was raised from 10 million won to 30 million won, and only cash would be accepted.
By then, the article says, the damage had already been done. Forced liquidations reached 2.3 trillion won, and the wealth of hundreds of thousands of households had been wiped out.
Even in the U.S. market, the deepest equity market in the world, leverage is still being worked off. The article cites a recent view from JPMorgan analysts that U.S. stocks still have room to deleverage and may need three months to recover to pre-April levels.
It also says the ratio of leveraged ETF assets in memory-chip stocks to the market value of the underlying names is three times the average level seen across all stock ETFs. Even among leveraged equity index ETFs as a whole, that ratio remains high relative to its own history.
A change in trading behavior, not a claim that stocks and crypto are identical
The article does not argue that equities and crypto are fundamentally the same. Stocks are still claims on companies with assets, revenue, cash flow, financial disclosure, audits, and regulation. Even after sentiment fades, a genuinely profitable company still has calculable value.
What has changed is the trading layer. Investors once bought a company’s future profits. More and more of them are now trading the popularity of a theme.
PANews describes this as a loss of rationality at the market level. Traditional stock investing focused on price-to-earnings ratios and cash flow. A crypto-style stock market focuses more on narrative and imagination. In the old frame, 20% volatility was already high. In the new one, daily moves of 10% to 15% in individual stocks are becoming routine.
The leverage tools have shifted as well. Traditional equity leverage came through margin financing and securities lending. In this crypto-like version of the stock market, leverage runs through ETFs, derivatives, and quantitative strategies. Information, too, has shifted from research notes and earnings reports to Twitter, YouTubers, and chat groups. Institutional behavior has changed alongside it; the article says institutions are becoming more retail-like, while quant strategies are chasing momentum both up and down.
At the same time, bitcoin is moving in the opposite direction. The article says bitcoin has been trying to become more like a stock through ETFs, deeper institutional participation, and lower volatility, gradually winning broader acceptance in mainstream finance.
That leaves a strange crossing point. Traders who left crypto for stocks are discovering that they never really left their “original family.” What repeats, PANews writes, is the same mechanism over and over again: a grand story, crowded positioning, easily available leverage, and the belief that one can get out before everyone else.
The article closes with a line posted by a South Korean retail investor on a trading forum: “I want to go back to the days before I traded stocks. Give me my money back.” The market, it says, does not issue refunds.