Fundstrat co-founder Tom Lee warned on October 13 that South Korea’s sharp stock-market decline could spill into cryptocurrency markets through forced selling and margin calls. Lee pointed to the country’s large base of digital-asset investors, arguing that equity losses could push some traders to sell crypto to raise liquidity .
This major decline in Korean equities likely spilling over into crypto
– margin liquidations in brokerage
– Koreans major holders of crypto
Short term pain $ETH https://t.co/Pe6bWrCBun
— Thomas (Tom) Lee (not drummer) FundstratDirect.com (@fundstrat) October 13, 2026
His warning came as the KOSPI suffered another steep decline, with weakness concentrated in major semiconductor stocks. Lee identified brokerage margin liquidations as one possible transmission channel, since investors facing collateral demands may need to sell other holdings, including digital assets. He characterized the potential impact as “short-term pain,” rather than predicting a prolonged crypto downturn .
The main question is whether stress in South Korean equities actually produces measurable selling across crypto markets. Further weakness would depend on margin pressure translating into real digital-asset liquidations , while stabilization in Korean stocks could reduce the immediate risk of contagion that Lee highlighted.
Source: Fundstrat .
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