South Korean stock market plunge pushes retail investor funds back to crypto, Upbit’s daily trading volume surges 436%

CZ responded on X regarding last night’s incident where a donation address burned some CZ and TCC tokens. He stated: “It’s not that deep. I haven’t checked that wallet in a long time. Opened it and found there were too many tokens (tens of thousands), and the software’s display was a bit unfriendly. I gave some suggestions, then did a test. Rather than sending to my address, it’s better to directly send them to a black hole.” Last night, CZ’s donation address transferred 700 million CZ tokens and 400 million TCC tokens to a black hole. Affected by the news, both CZ and TCC saw varying degrees of price surges.

According to data from trade.xyz, the annualized funding rate of the mainstream SK Hynix contract on the platform has soared to 907.74%, with open interest reaching $834 million. Meanwhile, the annualized funding rate for SK Hynix contracts on U.S. stock exchanges stands at -143.74%, though the open interest for this contract is only $88.77 million. The funding rate of SK Hynix contracts on Binance also reflects investors' optimistic sentiment, with the current annualized funding rate standing at 547.5%.

South Korean media reported on July 12 that South Korea’s five major commercial banks have used more than 85% of their full-year household loan growth quota in the first half of this year, with two banks even exceeding their full-year caps. Against the backdrop of strict aggregate control targets set by regulatory authorities, the banks have almost no room for new lending in the second half, leading the market to predict a credit "cliff" will materialize in H2, and stock market leverage funds entering the market via loans will face significant contraction pressure. The report notes that the two major drivers of rapid loan growth are the continuously surging demand for mortgage loans and personal loans used directly for stock market participation. Although banks tightened lending pace at the start of the year, neither type of demand has seen a noticeable decline, ultimately driving a continuous rise in loan balances in H1. For investors relying on credit leverage to trade in the stock market, available external financing channels in H2 are facing substantial tightening.

According to Bitget Market data, the Nikkei 225 index closed down 1,315 points on Monday, July 13, a 1.92% drop, ending at 67,242.73 points. Individual stock Kioxia fell over 10%. South Korea’s KOSPI index closed down 670 points the same day, a sharp 8.96% decline, to 6,805.88 points. The index triggered a circuit breaker during intraday trading after plunging more than 8%. On the individual stock front, SK Hynix dropped 15.3% and Samsung Electronics fell 10.7%.

According to Coinglass data, as Bitcoin continues its decline today, funding rates on major centralized (CEX) and decentralized (DEX) exchanges show the market remains significantly bearish. Specific funding rates are detailed in the attached chart. BlockBeats Note: The funding rate is a mechanism set by crypto trading platforms to align perpetual contract prices with their underlying asset prices. It serves as a fund exchange between long and short traders—platforms do not collect this fee. It adjusts the cost or returns of holding contracts to keep contract prices close to underlying asset values. A 0.01% funding rate is the benchmark: rates above 0.01% signal broad bullish sentiment, while rates below 0.005% indicate widespread bearishness.

South Korean media reported that the Korea Composite Stock Price Index (KOSPI) fell below the 7,000-point threshold during intraday trading, triggering the circuit breaker mechanism for the seventh time this year. Driven by renewed geopolitical tensions between the U.S. and Iran, foreign and institutional investors offloaded large volumes of stocks, pushing the index sharply lower. This marks KOSPI’s first intraday drop below 7,000 points in nearly two months, since May 4. Data shows foreign and institutional investors led the sell-off: foreign investors net sold 2.23 trillion won, institutional investors net sold around 570 billion won, while individual investors net bought nearly 2.7 trillion won. Among institutional investors, the National Pension Service net bought around 220 billion won. South Korean stocks have seen extreme volatility recently, swinging between sharp rallies and plunges. During today’s morning trading session, sellers triggered the sidecar mechanism (a temporary halt for program trading) for the 18th time this year; the circuit breaker was activated in the afternoon. Year-to-date, South Korean stocks have recorded 17 buyer-triggered sidecar operations and 18 seller-triggered ones, totaling 35.