Bitcoin Shows Resilience as AI Worries Fuel Another Rout in South Korean Stocks

South Korean stocks tumbled again on Tuesday as growing concerns about AI investment spending and competition from Chinese chipmakers hit the semiconductor sector. Bitcoin, by comparison, has maintained much of its recovery from the summer lows.

The KOSPI dropped 5.5% in Asian trading, putting it nearly 38% below its June record high. The benchmark’s decline contrasts with Bitcoin’s performance, as the cryptocurrency has rebounded about 40% since reaching its summer bottom.

Bitcoin fell to around $58,000 shortly after the KOSPI peaked, then recovered to as high as $87,000. The 20-day rolling correlation between Bitcoin and the South Korean index is -0.41 on the weekly chart, suggesting their movements have a moderately negative relationship.

The divergence could mean Bitcoin is showing relative strength as investors cut exposure to AI-related stocks. However, the correlation does not prove that money exiting equities is being invested in Bitcoin.

The latest slide in chip stocks followed remarks by Broadcom (AVGO) CEO Hock Tan, who compared speculative AI investments to gambling in a casino, according to the Financial Times. The comments intensified questions about whether the AI industry can generate enough revenue to support its huge infrastructure costs. Meanwhile, advances by Chinese memory-chip company CXMT have raised fresh concerns about competitive pressure and the outlook for chipmakers’ profit margins, Bloomberg reported.

SK Hynix shares fell approximately 10%, while Samsung Electronics declined 7%. The selloff also affected U.S. premarket trading, with Micron Technology (MU) and SanDisk (SNDK) each down around 3%.