Bitcoin briefly fell below $81,000 on Tuesday before rebounding above $83,000, while more than $800 million in crypto positions were liquidated over 24 hours. South Korean equities also came under heavy pressure as semiconductor stocks extended their declines, highlighting how concentrated technology exposure and leveraged trading are affecting both stock and crypto markets.
Bitcoin was trading at $83,168.19 during the period, up 0.68% over 24 hours. The recovery did not fully reverse selling pressure in derivatives markets. Traders are now watching whether the decline in Korean equities spreads further and whether leveraged positions begin to build again ahead of the release of US inflation data.
Samsung and SK Hynix fall for a fifth straight session
The Korea Composite Stock Price Index, or KOSPI, fell as much as 7.4% intraday before paring some of the decline and closing at 6,035.35. The index briefly dropped below 6,000, triggering a seller-side trading restriction mechanism. Samsung Electronics fell 7.39% and SK Hynix declined 10.09%, with both stocks closing lower for a fifth consecutive trading session.
Samsung Electronics and SK Hynix together account for roughly half of the KOSPI's total market capitalization, leaving the index particularly sensitive to shifts in expectations for artificial intelligence infrastructure spending. Foreign investors were net sellers of about 4.5 trillion won, or approximately $3.35 billion, in South Korean equities on Tuesday. The continued outflows put further pressure on the country's technology sector.
Investment research firm Paradis Labs said the recent decline reflected continued selling of Samsung Electronics and SK Hynix by overseas institutions. The firm described the current institutional positioning as “sell Korea, buy the US,” while noting that domestic South Korean investors remained broadly cautious. Some capital was moving from memory-chip manufacturers into financial stocks.
AI return concerns add to memory-chip competition
Paradis Labs said the market weakness had built over more than a single session, with recent remarks from Broadcom Chief Executive Hock Tan adding to existing selling pressure. Tan compared some speculative AI investment with gambling, prompting renewed debate over whether the industry's enormous capital spending will generate sufficient returns.
At the same time, China's ChangXin Memory Technologies announced that it had developed a DRAM architecture that it said could reduce the area occupied by memory cells by about 30%. The company plans to launch products using the technology by the end of 2026. The announcement increased concern about competition facing South Korean memory-chip manufacturers, although the technology's commercial viability and ability to reach mass production have not yet been established.
A Bitunix analyst said the broader market adjustment showed greater sensitivity to financing risks in the AI sector and concentrated investor positioning. Selling can remain concentrated even when semiconductor companies report strong earnings. The reduction of leveraged positions, together with weaker support from share buybacks, could amplify price swings.
Institutional asset allocation has also shifted. BlackRock lowered its rating on US equities from “overweight” to “neutral” and increased its preference for short-term US Treasuries, citing heightened concerns about AI-related volatility and rising financing costs.
South Korea's dependence on imported crude oil is another external variable. Paradis Labs said that if regional tensions involving Iran escalate and push energy prices higher for an extended period, inflationary pressure in South Korea could increase further and investor confidence in Korean equities could weaken. Pressure on semiconductor stocks has already spread to other markets: the Philadelphia Semiconductor Index fell 2.7% on Monday, while Japan's Nikkei 225 dropped 1.8% on Tuesday.
Crypto liquidations reach $812.9 million in 24 hours
Bitcoin's rebound came after a broad wave of derivatives liquidations as equity markets declined. Data from CoinGlass showed that 170,209 crypto traders were forcibly liquidated over the previous 24 hours, with total liquidations reaching $812.9 million. Long positions accounted for $686.72 million, or 84.5% of the total, while short positions accounted for $126.19 million.
Bitcoin recorded the largest amount of liquidations at $192.14 million, with nearly 74% coming from long positions. Ethereum liquidations totaled $180.5 million, while Solana liquidations reached $60.85 million. The largest single liquidation was a $9.65 million Bitcoin long position on Binance.
As Bitcoin fell, forced closures of long positions added to selling pressure and accelerated the decline. When the price subsequently rebounded, short positions began to be liquidated, contributing to the speed of the reversal. Trading activity nevertheless indicated that buyers had not yet regained clear control.
CryptoQuant analyst JA Maartunn said Bitcoin's Net Taker Volume had turned negative again, meaning aggressive selling in the derivatives market exceeded aggressive buying. The indicator suggests that the rebound may have been supported partly by passive buying and short covering rather than by a sustained increase in active demand.
If the decline in Asian equities broadens, or if traders rebuild leveraged positions before the US inflation report is released on Wednesday, Bitcoin's rebound could face renewed price pressure.