Bitcoin rebounded above $83,000 on Tuesday despite a sharp Asian stock selloff and cryptocurrency liquidations exceeding $800 million. BTC recovered after briefly slipping below $81,000, while semiconductor shares continued a deepening decline that sent South Korea's benchmark KOSPI index down 6%.
South Korean Market Pressured by Semiconductor Decline
South Korea's KOSPI plunged as much as 7.4% before recovering some losses to close at 6,035.35. The decline briefly pushed the index below 6,000 and triggered a sell-side trading curb as the country's largest semiconductor manufacturers extended their losses.
Samsung Electronics fell 7.39%, while SK Hynix declined 10.09%, marking a fifth consecutive session of losses for both companies. Together, the two memory-chip manufacturers account for approximately half of the KOSPI's market capitalization, leaving the broader index particularly sensitive to changes in the outlook for AI infrastructure spending.
Foreign investors sold approximately 4.5 trillion won ($3.35 billion) of Korean equities during Tuesday's session, extending a series of withdrawals that have weighed heavily on the country's technology sector. Research firm Paradis Labs characterized the prevailing institutional strategy as "Sell Korea, Buy US," while noting that domestic investors had largely remained patient.
Recent comments from Broadcom Chief Executive Officer Hock Tan, who compared speculative AI investment to gambling, intensified concerns about the industry's capital commitments. Additionally, China's ChangXin Memory Technologies announced development of a DRAM architecture capable of reducing memory-cell area by approximately 30%, with products planned by the end of 2026, raising competition concerns for South Korean producers.
The semiconductor weakness has spread beyond Korea, with the Philadelphia Semiconductor Index declining 2.7% on Monday and Japan's Nikkei 225 falling 1.8% on Tuesday.
Cryptocurrency Market Faces Liquidation Pressures
Bitcoin's rebound followed a significant derivatives market shakeout. According to CoinGlass data, cryptocurrency liquidations reached $812.9 million over 24 hours, affecting 170,209 traders. Bullish positions accounted for $686.72 million, or 84.5% of the total, compared with $126.19 million in bearish bets.
Bitcoin recorded the largest losses at $192.14 million, with long positions accounting for nearly 74% of the total. Ethereum followed with $180.5 million in liquidations, while Solana saw $60.85 million. The largest single liquidation was a $9.65 million Bitcoin long position on Binance.
As Bitcoin declined, forced long-position closures added selling pressure and accelerated the downturn. The subsequent recovery caught bearish traders off guard, with short liquidations contributing to the sharp reversal. However, underlying trading activity suggests that buyers have struggled to regain control despite the price recovery.
CryptoQuant analyst JA Maartunn reported that Bitcoin's Net Taker Volume turned negative again, indicating that aggressive selling in derivatives markets outweighed buying activity. This suggests that passive buying and the closure of bearish positions may be supporting prices without a sustained increase in aggressive demand.
