The Bank of Korea warns that shocks from the crypto market could spread to traditional financial markets

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Mars Finance News, according to the People's Daily, the Bank of Korea (central bank) warned in the "Financial Stability Report for the First Half of 2026" that as the correlation between the cryptocurrency market and traditional markets increases, shocks in the crypto market could spill over into traditional stock and foreign exchange markets. The central bank's analysis indicates that due to a more diversified investor base and evolving market structures, the risk transmission from the crypto market to traditional finance is on the rise. The report states that because South Korea has not yet approved spot and futures crypto ETFs, and corporate participation is limited, the direct impact on the domestic financial market remains limited for now. However, the central bank also warns that if institutional and corporate participation expands in the future, significant price shocks in crypto assets could spread to domestic stocks and foreign exchange markets.
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