Retail traders, particularly those in South Korea, have increasingly shifted from altcoins to crypto-related stocks, leaving a huge funding gap in the altcoin market, according to new data from 10x Research.
Key points to remember:
- Retail investors, particularly in South Korea, have shifted from altcoins to crypto-related stocks, creating an $800 billion gap in the altcoin market value.
- Institutional demand for Bitcoin and the rise of listed crypto companies have widened the gap between Bitcoin and other digital assets.
- 10x Research warns that this trend signals a structural shift, with altcoins likely struggling to attract new capital.
Over the years, Bitcoin and altcoins have tended to rise and fall together, driven by common speculation cycles.
But this time, the institutional adoption of Bitcoin and the growing popularity of listed crypto companies have created what 10x Research calls a “nearly trillion-dollar gap” between the market value of Bitcoin and that of other digital assets.
South Korea’s Shift to Crypto Stocks Leaves an $800 Billion Altcoin Gap
South Korea has long been a hub for altcoin trading, with local investors often preferring the smaller tokens over Bitcoin.
At times, altcoins account for more than 80% of trading activity on Korean exchanges, compared to global averages where Bitcoin and Ether dominate.
“The Altcoin market cap would be around $800 billion higher if retail investors – particularly in South Korea – had not redirected their attention to crypto-related and other stocks,” said Markus Thielen, CEO and head of research at 10x Research.
“In this cycle, altcoins have failed to attract enough new capital.”
Between November 5 and 28, 2024, Korean exchanges recorded average daily crypto volumes of $9.4 billion, surpassing the $7 billion traded on the Kospi stock index, according to data from CCData and Korea Exchange. These volumes have since plunged.
Breakup
South Korea is warning traders that there appears to be a large carry trade that is about to blow up markets. If the carry trade reverses, it will wipe out the country’s entire financial system, with its investors focused entirely on leveraged tech ETFs.$spy $qqq $dxy $tlt…
-Roger (@rdd147) October 13, 2025
10x Research has warned that declining retail participation is one of the main reasons why altcoins are lagging Bitcoin – and the trend could deepen.
A recent market sell-off triggered by renewed trade tensions between the United States and China wiped out $380 billion in crypto market value, of which $131 billion came from altcoins alone.
According to 10x, this change marks a “structural shift” in the market. As institutional money flows into Bitcoin and speculative traders chase away token-holding stocks, the altcoin sector may struggle to regain its lost capital share in the near future.
South Korean retail investors invest $1.24 billion in US tech and crypto stocks
As reported, South Korean investors turned the Chuseok holiday into a week of high-risk trading, pumping $1.24 billion into U.S. tech and crypto assets while local markets were closed between October 3 and 9, according to data from the Korea Securities Depository.
The frenzy was led by leveraged ETFs and high-growth stocks, as traders sought to take advantage of Wall Street’s momentum amid optimism surrounding U.S. technological resilience and hopes for domestic recovery.
Top foreign purchases included the Direxion Daily Tesla Bull 2X ETF with $151 million in purchases, followed by Iris Energy ($105 million), Meta Platforms ($100 million) and Tesla ($96 million).
Investors also bought $95 million worth of the T-REX 2X Long BMNR Daily Target ETF, which tracks BitMine Immersion Technologies with dual exposure, highlighting the growing appetite for crypto-related stocks.
However, the timing proved unfortunate. The buying spree ended abruptly when trade tensions between the United States and China triggered a global market pullback, erasing much of the previous week’s gains.
Meanwhile, in August, South Korea’s financial regulator moved to curb risky lending practices in the digital assets sector, ordering local exchanges to suspend all crypto lending services until a proper regulatory framework is established.
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