South Korean crypto exchanges saw a fresh spike in trading activity as the country’s stock market had several days of significant downside.
Cryptocurrency trading volumes spiked in South Korea as its stock market fell by nearly 18% this week.
KRW/USDT volumes spike in response to stock sell-off
Data from largest South Korean exchange Upbit shows trading volume accelerating between the Korean won and Tether (USDT). It neared 200 billion won (140 million USDT) on July 29, up from just 20 million USDT on July 25 — an increase of 600%.
Korean won crypto trading-volume data. Source: Upbit
On the back of several straight days of downside on South Korea’s KOSPI, which came as a result of a sell-off in chip-maker stocks, investors variously sought protection and to take advantage of the decline. Capital could have flowed out of stocks to crypto, analysis referenced by local media outlet Seoul Economic Daily suggested, while investors could also have targeted derivatives of Korean equities via overseas crypto exchanges.
“There is a possibility that demand increased for moving funds to overseas exchanges or personal wallets to trade perpetual stock futures,” Cho Yoon-sung, a senior researcher at independent digital asset research and data provider Tiger Research, told the publication.
As Cointelegraph reported, an influx into semiconductors and away from crypto earlier this year is now under scrutiny as the tide turns on the AI trade’s rapid rise.
Crypto trading remains a hive of activity in South Korea, as younger traders in particular display a fondness for risk. Traders’ fondness for leveraged bets is an overarching feature of both crypto markets and this year’s AI retail boom.
The impact of KOSPI volatility on crypto trading volumes was in evidence before this week’s rout. On July 14, Upbit saw a conspicuous volume surge after the index plunged 10% in a single day.
Related: Bitcoin price wedged into ‘most divided’ FOMC as Iran war spikes oil prices 8%
Commenting on the latest events, Andre Dragosch, European head of research at crypto asset manager Bitwise, underscored the lack of contagion resulting from the semiconductor “meltdown.”
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