Analysis: The Positive Correlation Between South Korean Stock Indices and BTC Prices Has Been Broken, Funds Are Shifting from the Stock Market to the Crypto Market

【Analysis: The Positive Correlation Between South Korean Stock Indices and BTC Prices Has Been Broken, Funds Are Shifting from the Stock Market to the Crypto Market】Golden Finance reports that this year, against a backdrop of a strong dollar, Asian stock markets have shown mixed results. Some have achieved a bull market in local currency at the expense of currency depreciation, while others have sacrificed some stock market gains with relatively stable exchange rates, with South Korea being a notable exception. Measured in Korean won, the South Korean Composite Index (KSOPI) has dropped 10.0% this year. Considering the depreciation of the won, the KSOPI in USD terms has fallen 18.9%, making it the weakest in Asia. From the perspective of capital flow, since the second half of this year, only institutional investors in South Korea have maintained a net buying scale in the stock market, while the household sector has been continuously reducing purchases. The analysis suggests that a significant portion of the money South Korean residents have pulled out of the stock market has gone into 'speculating on cryptocurrencies.' Data from the Bank of Korea (BOK) shows that as of November, the number of domestic cryptocurrency investors in South Korea has reached 15.59 million, an increase of 610,000 from the previous month. Currently, 30% of South Korea's 51 million citizens are involved in cryptocurrency speculation. The average daily trading volume of South Korea's top five cryptocurrency exchanges—UPbit, Bithumb, Coinone, Korbit, and GOPAX—has surged from 34 trillion won in October to 149 trillion won in November, more than quadrupling. South Koreans have always been enthusiastic about investing in cryptocurrencies. During the first wave of the cryptocurrency bull market in 2017, about 5% of the population participated; in the second round of the bull market in 2021, 10% participated; and now this proportion has expanded to 30%. However, historically, the South Korean stock index and Bitcoin prices have had an overall positive correlation, which was completely broken in October of this year. (Wall Street Watch)