Korean Investors Face Brutal Hangover After AI-Linked Stock Market Bubble Bursts

Korean retail investors are facing stress after a rapid correction in the stock market, which has seen significant interest from crypto traders.

In late 2025, Korean investors shifted their attention from memecoins to equities tied to artificial intelligence infrastructure, with semiconductor giants SK Hynix and Samsung Electronics being major beneficiaries.

The trading volumes on domestic crypto exchanges like Upbit and Bithumb plummeted as money flowed out of digital assets and into stock portfolios. Leveraged single-stock ETFs tracking SK Hynix and Samsung Electronics had attracted tens of billions in assets, but when the correction hit, forced liquidations cascaded through the market.

The KOSPI index surged by nearly 180% in roughly 10 months, only to shed nearly 25% in just four weeks by mid-2026. The stress levels among Korean retail investors are now reportedly elevated.