Risk-Off Wave Hits Crypto as Global Volatility Spikes; $600M in Longs Wiped Out in 24 Hours
Global market volatility has flared up again, spilling from a steep slump in South Korean equities and a fresh tech-led selloff into broader risk assets, according to CoinDesk. Crypto was pulled into the downdraft: bitcoin briefly slid to about $62,400, SOL fell 7% in a day, and more than $600 million in leveraged long positions were liquidated across the market over the past 24 hours.
The latest bout of selling started in South Korea. The KOSPI Composite Index ended Tuesday down 9.99% at 8,203.84, marking its second-largest single-day drop this year. Heavyweights led the decline, with Samsung Electronics and SK Hynix both tumbling more than 12%. Given their outsized index weight, the sharp fall in chip shares quickly amplified pressure on the broader market. The report added that the volatility could also prompt investors to trim positions elsewhere to meet margin calls.
In the U.S., tech weakness weighed on equities as well. CoinDesk said the S&P 500 shed roughly $1.4 trillion in market value. Precious metals also retreated, with gold dropping below $4,000 and silver falling under $60.
The report also noted that Federal Reserve Chair Kevin Warsh kept the policy rate in the 3.50% to 3.75% range for a fourth straight meeting at his first FOMC gathering. Markets are watching the Fed's forward guidance closely, including whether officials still expect any rate increases this year.
Against that backdrop, bitcoin fell to around $62,400 on Tuesday, down more than 3% on the day and about 5% for the week. The move pressured the broader crypto complex and set off liquidation cascades, with more than $600 million in long positions cleared. SOL posted a one-day loss of 7%.
As traditional markets bounced, crypto lagged. CoinDesk reported the KOSPI has recovered about 4% from its low, and the S&P 500 and Nasdaq turned positive at times over the past 24 hours, while crypto's rebound has been weaker.
Sentiment has also been weighed down by lingering concerns tied to Strategy and related securities. After the company announced another bitcoin purchase, MSTR slid to $103.52 on Tuesday, its lowest level since August 2024. STRC was cited as trading about 12% below par value, fueling worries among some participants that this could sharpen concerns about the firm's debt and bitcoin holdings.
Some support has come from easing Middle East tensions. With U.S.-Iran talks progressing, pressure on oil shipments through the Strait of Hormuz has eased and oil prices have retreated to pre-closure levels, reducing supply-chain strain and fears of an energy shock.
Attention now turns to Micron's latest quarterly earnings. The durability of semiconductor momentum and the AI trading theme could shape tech stocks next, with knock-on effects for risk appetite in crypto.
