Samsung, SK Hynix Sink 12% as Kospi Crashes 10%
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- South Korea's Kospi closed down 10% — its fourth circuit breaker of the year after none in all of 2025 — as foreign investors dumped more than $2.5 billion in shares and the country's volatility gauge spiked toward 90.
- Samsung Electronics and SK Hynix each fell more than 12%, serving as global proxies for AI chip demand whose slide reflects the same trade that hit SpaceX and the Nasdaq this week as investors reassess whether massive AI spending will pay off.
- Leveraged ETFs tracking the two chip stocks amplified the rout — one fund offering twice the daily return of SK Hynix lost more than 25%, per Bloomberg — compounding forced selling by Korean retail traders using borrowed money.
- Bitcoin eased toward $63,000, holding far better than Korean equities as forced-liquidation cascades, long crypto's signature, tore through leveraged stock markets instead; crypto now accounts for only about 8% of Kospi volume.
- Korean retail traders, once a major force in crypto, have largely shifted to leveraged stock bets, which is why the equity panic had little direct crypto selling to feed — though the source notes a deeper AI unwind could still test Bitcoin in the coming days.
Why it matters: The forced-liquidation cascade that long defined crypto has migrated into Korean leveraged stock products, with a 2x SK Hynix ETF losing over 25% and triggering a circuit breaker — and because retail leverage has shifted away from crypto (now just 8% of Kospi volume), the selloff hit equities first rather than feeding back into Bitcoin as it would have in prior cycles.
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