South Korean retail investors are shifting from large U.S. tech stocks to high-risk, high-reward cryptocurrency-related stocks.
According to a report by Yonhap News Agency citing data from the Korea International Financial Center (KCIF), the proportion of cryptocurrency-related stocks among the top 50 net bought stocks by South Korean investors rose from 8.5% in January to 36.5% in June, before dropping to 31.5% in July.
The report added that the net purchase amount for top U.S. tech companies fell to $260 million in July, an 84% decrease from the average monthly amount of $1.68 billion between January and April.
KCIF attributed this shift to the rapid acceptance of stablecoins in the global financial market, stating that the recently passed U.S. GENIUS Act facilitated this change.
Ethereum accumulation company BitMine Immersion Technologies is the biggest beneficiary of the shift in preference among South Korean investors.
On Monday, Bloomberg cited data from the Korea Securities Depository, reporting that South Korean retail investors have invested $259 million in BitMine stock since early July. This made the company the most purchased overseas securities stock in the country for July.
In the past 30 days, BitMine has increased its ETH holdings by 410.68% to 833,100 ETH. It now holds the largest Ethereum (ETH) reserve in the world. With ETH surpassing $4,300 on Monday, the company's holdings are valued at nearly $3.6 billion, a 24% increase from Tuesday's value.
While Ethereum co-founder Vitalik Buterin supports publicly traded companies buying ETH, he warned investors that the future of ETH should not come at the cost of excessive leverage.
In the Bankless podcast, Buterin stated that if treasuries turn into "over-leveraged games," it could lead to the "decline of ETH." Buterin outlined a worst-case chain reaction where a drop in ETH prices could trigger a series of liquidations.
Nevertheless, he expressed confidence that ETH investors are disciplined enough to avoid such a scenario.
Related: Crypto assets storm retirement accounts, is the 401(k) becoming a new engine of wealth?
Original article: “South Korean Investors Shift from U.S. Tech Stocks to Cryptocurrency-Related Stocks”
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