Analysts warn that a sharp decline in South Korea’s stock market could increase pressure on Bitcoin, although the cryptocurrency has so far remained relatively resilient.
South Korea’s benchmark KOSPI index plunged 8.95% on Monday after trading was briefly halted by an intraday circuit breaker. The selloff was led by semiconductor giant SK Hynix, whose shares tumbled more than 15%, intensifying concerns that risk aversion could spread across global financial markets.
The KOSPI ended the session at 6,806.93 after the trading halt. SK Hynix closed down 15.37% at KRW 1.845 million, leaving the stock roughly 38% below the record high it reached just weeks earlier on June 25.
Hupzy, an analyst at Spot On Chain, described the move as a panic driven selloff, noting that circuit breakers are rarely triggered outside periods of extreme market stress. The analyst also pointed to the sharp reversal in artificial intelligence and semiconductor stocks, warning that weakness in those sectors could spill over into crypto assets tied to AI narratives.
The latest decline comes after global markets had already experienced significant volatility. More than $1.5 trillion was wiped from financial markets within 10 hours, affecting Bitcoin, precious metals, and major Asian equity indexes amid escalating geopolitical tensions and weakening investor sentiment.
Bitcoin, which had recovered from its early July decline below $58,000 and briefly climbed above $64,000, slipped back below $63,000 as broader market uncertainty returned.
Crypto analyst Ash Crypto attributed the market weakness to renewed conflict between the United States and Iran, the possibility of intervention by the Bank of Japan to support the yen, and rising bond yields.
Hupzy warned that if U.S. stocks mirror the losses seen in Asia, selling pressure could intensify across digital assets. According to the analyst, a broad equity market downturn could push Bitcoin below important technical support levels.
Not all analysts share the bearish outlook. Michaël van de Poppe argued that Bitcoin has demonstrated notable resilience during the recent turbulence, saying the asset continues to hold key support despite repeated tests of higher resistance levels.
Ted Pillows also noted that Bitcoin must maintain support around $62,500 after failing several times to break through the $64,500 to $65,000 resistance zone. A sustained move below that level, he warned, could open the door to a decline beneath $61,000.
Meanwhile, concerns are growing over how much liquidity remains available to stabilize markets if selling accelerates further.
According to data shared by Hedgie Markets, U.S. cash holdings, including money market funds and bank deposits, now represent just 42% of the S&P 500’s total market capitalization, one of the lowest ratios on record and comparable to levels seen before the dot com bubble burst.
Although money market funds currently hold a record $7.95 trillion, the S&P 500’s market value has expanded to roughly $69 trillion, suggesting that available cash may provide less support than headline figures imply if global markets face a deeper correction.#crypto#cryptonews https://coinsignals.net https://t.me/coinsignalpublic
