#cryptonews
A South Korean expert says panicked investors thought their crypto was under threat when President Yoon Seok-yul declared martial law last week.
In an opinion piece for Hankyoreh, the author and crypto journalist Kim Oe-hyeon identified four key reasons why domestic traders responded to Yoon’s move with a mass sell-off.
Trading volumes spiked on platforms like Upbit and Bithumb late on December 3 when Yoon declared martial law.
Kim noted that “a number of structural problems” worked in tandem behind the scenes to cause chaos on South Korean crypto exchanges.
The market has also been unmoved by a series of prosecution service attempts to arrest the President on “treason” charges.
Trading volumes have since shrunk back to their lowest level in almost a month. South Korean media outlets on December 8 reported that parliament’s subsequent failed motion to impeach Yoon had so far failed to move investors to act.
Bitcoin (BTC) prices tumbled by up to 30% on major exchanges, at a time when the token was trading for just under $96,000 on overseas platforms.
Kim wrote that Yoon’s “absurd” decision to declare martial law had “sent huge shock waves” across the crypto market “in real-time.”
He added that traders were concerned about the “possibility of additional regulations such as asset freezes or the suspension of exchange operations.”
Kim wrote that the first major fact influencing the price drop was a sudden rush of “uncertainty and anxiety.”
Kim, meanwhile, noted that the “structural characteristics” of the South Korean market had “amplified” anxiety levels. He remarked that, unlike the United States, the South Korean market is “overwhelmingly dominated by individual investors.” He explained: “This means that the market is structured to be easily swayed by news and sentiment.”
He said: “When I woke up, I checked my [crypto-themed chat app] groups and saw that once a few people said they were selling their tokens for cash, others said they’d do the same. I think that once a few traders said they were selling, it had a snowball effect.”