Young investors in their 20s and 30s accounted for 62% of stock accounts that were forcibly liquidated in South Korea’s recent leverage-driven selloff, according to a BlockTempo opinion column by Evan Cheng. The piece argues that the buying spree in leveraged products was not simply a story of greed. It was also a response from a generation that already sees itself as losing ground.
That argument sits at the center of the article’s reading of South Korea’s latest trading boom and bust in single-stock 2x leveraged exchange-traded funds tied to Samsung Electronics and SK Hynix.
More than 530,000 people completed the mandatory course
From January to April 2026, 530,494 people completed the Korea Financial Investment Association’s online risk course for leveraged ETFs. That was about 2.5 times the 205,403 people who completed it in all of 2025.
Investors did not take the class out of curiosity. They had to finish it before buying leveraged ETFs. Under the rules described in the article, buyers of 2x leveraged products also had to prepare a minimum deposit of KRW 10 million, which the original piece says is roughly TWD 217,000.
The column says the regulatory design looked reasonable on paper. In practice, however, the course and the deposit requirement did not stop demand. The author writes that the 530,000 people who completed the lesson mostly went on to buy anyway.
The losses were steep. In the first two weeks of July, the average return on Samsung Electronics single-stock leveraged ETFs was -42.1%, while SK Hynix products posted -53.5%, according to the article.
Cheng says the more revealing part of the episode is not the size of the losses, but the existence of the course itself. If a government has to force young people to sit through a risk class in order to keep them out of dangerous trades, the deeper problem is usually not a lack of financial knowledge.
The piece cites Korean media coverage of a 25-year-old university student who combined student loans and emergency borrowing into KRW 22 million and put the money into the stock market, only to lose KRW 6 million. The point, the author says, is that he had not been kept away by education.
The rise of “suddenly poor” as a social label
To explain the behavior, the article turns to a Korean term: 벼락거지, or byeorak-geoji. The phrase roughly means “suddenly poor” and stands opposite to the idea of a sudden rich person. It became popular online around 2020 and is now used in mainstream media and academic papers, according to the column.
The term refers to people whose income did not fall, but who became poorer in relative terms because home prices and stock prices surged. There is no explicit loss in that definition. No layoff. No bad trade. No error. People simply stayed where they were while asset inflation pushed them backward.
The article says the Korean media reform group Media Today once criticized the term for stirring anxiety and hostility around poverty. Even so, Cheng argues that the criticism itself shows how deeply the term has spread.
Its real force lies in how it reframes inaction. In the world described by byeorak-geoji, leaving money in a savings account is no longer preserving principal. It is a way of bleeding slowly. The column points to a separate feature by Asia Economy titled “2030 trapped by debt,” with a subhead that said fixed-term deposits had become a luxury.
Why the author says this is not greed
Cheng uses Prospect Theory, developed by Daniel Kahneman and Amos Tversky in 1979, to make the case. The theory says people do not have one permanent attitude toward risk. Their behavior depends on whether they feel they are operating from gains or losses.
In gain territory, people often prefer certainty. In loss territory, they become more willing to gamble. The article gives a simple example: one option is a certain loss of 800, while another offers an 80% chance of losing 1,000 and a 20% chance of losing nothing. Many people choose the second path even though its expected value is worse.
The key concept is the reference point. Cheng argues that for Koreans in their 20s and 30s, the benchmark is not their own cost basis or current income. It is the apartment their parents’ generation already had. Measured against that point, they begin from a perceived loss position.
In that setting, the article says, taking 2x leverage stops looking like simple greed. It starts to look like a response that behavioral economics would predict from people who believe they are already behind.
Employment, household wealth and housing all moved the wrong way
The column backs that argument with a series of economic indicators:
- South Korea’s employment rate for people aged 15 to 29 was 43.8% in May 2026.
- Average net assets for households headed by people under 39 fell from KRW 261.4 million in 2022 to KRW 219.5 million in 2025, a decline of about 16% over three years.
- Among households in the bottom 20% for both income and net assets, the share made up by people in their 20s and 30s rose from 7.9% in 2020 to 15.2% last year.
- Over the same period, the price index for Seoul apartments under 40 square meters rose 17.1% in one year.
The article says those numbers explain why the sense of becoming poorer is not just an online feeling. Wages are not keeping pace. Housing remains out of reach.
It also points to a wider concentration in the Korean economy. Combined revenue at Samsung, Hyundai Motor, LG and SK now amounts to 60% of South Korea’s GDP, up from roughly 40% a decade ago.
In Cheng’s telling, the real fault lines run not only between generations, but also between big companies and small firms, and between regular and irregular workers. Young people are more often stuck on the weaker side of those divides.
In the first quarter of 2026, households in the lowest 20% by income posted a real balance of negative KRW 438,000, the largest quarterly deficit since the statistic was first compiled in 2019. High-income households, by contrast, saw their surplus widen.
The article also references the long-running Korean idea of “spoon class,” where people are sorted into gold, silver and dirt spoons based on the circumstances of their birth. What started as internet sarcasm has become a term discussed in sociology, the author says.
Mortgage leverage was restricted while equity leverage was opened
Cheng sees this as the sharpest contradiction in the whole episode.
Previous generations in South Korea used leverage too, but mostly through mortgages. Borrowing to buy a rising housing asset was a standard middle-class path to wealth and a major channel of social mobility in the postwar economy.
Younger Koreans coined a term for that strategy: 영끌, which means scraping together everything, even one’s soul, to buy a home.
That route, the article says, has since been narrowed by policy. To restrain household debt, the government repeatedly tightened lending limits. As home prices rose and loan-to-value ratios fell, the amount of cash needed upfront became harder to meet.
The column cites a Sisa Journal headline that said even 영끌 had become a luxury. Several Korean media outlets, it says, have reported that the “housing ladder” from renting to owning is effectively broken.
Against that backdrop, South Korea approved the listing of 2x single-stock leveraged ETFs tied to Samsung Electronics and SK Hynix on May 27. Entry required a KRW 10 million deposit and a two-hour online class.
The article notes that household debt stood at 88.6% of GDP in March 2026, keeping South Korea near the top globally. The contrast, as Cheng frames it, is stark: a relatively safer form of leverage was shut down, while a riskier one was opened up.
Assets surged to KRW 14 trillion within weeks
The products were listed at the end of May. Within a few weeks, assets grew from about $3 billion to KRW 14 trillion, according to the piece.
Retail investors were net buyers of KRW 4.2386 trillion worth of SK Hynix-related series and KRW 1.6119 trillion worth of Samsung Electronics-related series in a month. Roughly 92% of holders were retail investors.
By the time the boom peaked, leveraged ETFs together with the two chip stocks accounted for more than 70% of trading volume in what the article describes as a $4.3 trillion market. The author’s summary is blunt: one country’s equity market turned into a 2x wager on two companies.
During the mid-June selloff, domestic leveraged ETFs fell about 25% in a single day. On June 22, Lee Chan-jin, head of South Korea’s Financial Supervisory Service, said publicly that he regretted how quickly the products had been approved.
By then, the damage had mounted. The article says market estimates put individual investor losses in leveraged products at roughly KRW 2.15 trillion over the previous month.
Margin loan balances climbed to a record KRW 38.6328 trillion on June 24. Among investors in their 20s, margin balances increased 2.24 times over a year, above the all-age average rise of 1.96 times. In forced liquidation accounts, people in their 20s and 30s made up 62%.
The group that lost the most, the author writes, was the one least able to afford it.
A mirror for South Korea’s crypto market
The article then shifts to crypto and argues that the same pressures are visible there as well.
In 2026, KRW pairs represented 30% of global spot cryptocurrency trading, second only to the U.S. dollar market. Upbit and Bithumb accounted for about 96% of trading volume inside South Korea. Cheng uses those figures to show how a country of roughly 51 million people and an economy ranked around 12th in the world could still support nearly one-third of global spot crypto volume.
That does not necessarily mean crypto is uniquely beloved in South Korea, the article says. It may also mean the same desperation found another venue. The long-running kimchi premium, where Bitcoin trades at a higher price on Korean exchanges than in overseas markets, is described in the column as a signal that more people are trying to get in than get out.
The two arenas are connected in the author’s account. Korean crypto trading volume shrank sharply at one point in late 2025, but the money did not leave speculation. It moved into AI chip shares. After leveraged ETFs tied to those names fell apart in the first half of this year, that money was taken out of the hands of the same “suddenly poor” crowd.
Online posts captured the pain in plain language
The article cites several comments from Korean online communities and local media interviews.
On Blind, an anonymous workplace forum that requires company email verification, one user posted a screenshot showing mark-to-market losses of KRW 12.9 million across three positions and wrote: “I’ve never cut losses in 10 years of stock trading, just held on through everything. Is this finally the time to cut?”
Some replies asked what kind of portfolio it was to hold the common stock, its leveraged ETF and another leveraged product tied to a different company at the same time. Others told the poster to keep holding.
A shorter line circulated elsewhere online: “Are the people who borrowed to invest still alive?”
Korean financial media also interviewed office workers caught in the slide. One man in his 30s said, “I sold yesterday, and it went up today,” before adding that he wanted to hold for one more day but could not bear the previous day’s intraday losses. A man in his 40s said he went into a meeting thinking it was just a small drop and came out at noon to find his loss rate had ballooned. Another investor in his 30s said, “Because it was national-team Samsung Electronics, I thought the risk was lower.”
That line matters in the article’s telling. Samsung is a household name in South Korea. Many retail investors did not feel they were gambling. They felt they were buying the national champion.
On DC Inside, one of the country’s biggest online communities, a popular post during the selloff was titled: “Ants crushed by Samsung and Hynix leverage average down in tears.” In Korea, “ants” is a common self-description for retail traders.
The article says those traders were not cutting losses. They were adding to positions. Herald reported at the time that about 94% of leveraged investors were underwater.
Another report from Nocut News, according to the column, put the problem in one sentence: “Everyone knows the problem. There just isn’t a solution.” Cheng says that line is not about technical investing knowledge. It is about a world where wages cannot catch assets, assets cannot catch the previous generation’s starting line, and safer routes upward have been blocked.
Regulators are raising the barrier again
South Korea has already announced a new response.
Starting Aug. 5, the minimum deposit for single-stock leveraged ETFs will rise from KRW 10 million to KRW 30 million. The mandatory risk course will be extended from two hours to three. The government has also set up a nationwide debt counseling hotline, 1375, expanded financial support centers and started building an early warning system. The article says the president has called for faster countermeasures and signaled a real-estate discussion meeting.
Cheng argues that raising the deposit to KRW 30 million will block out the people with the least money first, including the same younger investors who suffered the heaviest losses. If the goal is to stop self-destructive bets, the move may work. If the issue is access to an asset ladder, the effect looks different.
The author is equally skeptical about adding one more hour to the class. The first two hours already explained negative compounding, volatility drag and forced liquidation, the article says. More than 530,000 people heard those lessons and still tapped the buy button in their brokerage apps.
The column closes with a final point: the three-hour course still does not teach people where to turn if they cannot use stocks to try to move up.
The article was published as an Evan Cheng column. Its views are the author’s own and do not constitute investment advice.