Crypto markets reel as tariffs and credit stress collide
The cryptocurrency market has come under renewed pressure as escalating global tariff tensions converge with growing stress in the private credit sector, though a South Korean analyst suggests that prospects for a rebound remain intact. According to Etoday, Yang Hyun-kyung, a researcher at iM Securities, noted that risk assets staged a brief rally after the U.S. Supreme Court ruled that President Donald Trump’s reciprocal tariffs, imposed under the International Emergency Economic Powers Act (IEEPA), were unlawful. However, the relief proved short-lived as tariff fears reignited following the announcement of a 10% levy and a subsequent proposal to increase it to 15%.Photo by Markus Winkler on UnsplashLiquidations surge amid private credit jittersYang observed that market volatility intensified as concerns in the private credit market resurfaced after Blue Owl Capital halted redemptions for its Blue Owl Capital Corporation II (OBDC II) fund and initiated a $1.4 billion asset sale. Yang highlighted that $420 million in liquidations hit the crypto market as Asian trading opened on Feb. 23. This included $386 million in long positions and $34 million in shorts, signaling a swift deleveraging. These pressures are reflected in current price levels. According to CoinMarketCap, Bitcoin, the world’s largest cryptocurrency, is trading just below $65,000, down 1.13% over the past 24 hours. The token remains approximately 49% below the all-time high recorded in October. Bitcoin’s decline has widened valuation losses among digital asset treasury (DAT) firms. Yang estimated that Strategy, which holds 717,131 BTC, is sitting on roughly $7.89 billion in unrealized losses. Yang added that a potential shift toward monetary easing ahead of the U.S. midterm elections, combined with reduced regulatory uncertainty from the crypto market structure bill known as the Clarity Act, could serve as short-term catalysts for a rebound. Binance focuses on regulatory alignment in KoreaDespite the market slump, crypto firms are deepening their presence in South Korea. In an interview with ZDNet Korea, Binance Head of APAC SB Seker stated that the company’s focus is not on increasing its ownership stake, but on establishing a compliant, trusted, and sustainable operation in the country. Binance currently holds a 67.45% stake in Gopax, operated by Streami, after securing regulatory approval to become its largest shareholder. Addressing the issue regarding GoFi—Gopax’s DeFi product designed to generate returns for users—Seker said any repayments of unpaid customer funds must comply with Korean commercial law and satisfy relevant legal and administrative procedures. He added that discussions with regulators are ongoing and the company cannot unilaterally set a repayment schedule. Seker also noted that Binance plans to work closely with authorities to advance its business in areas such as institutional investment and stablecoins. Regulators reiterate exchange ownership capsAs the digital asset sector evolves, South Korea is moving to tighten oversight. MoneyToday reported that financial authorities have notified the heads of the country’s five largest crypto exchanges—Upbit, Bithumb, Korbit, Coinone, and Gopax—of their intention to introduce caps on the ownership stakes of controlling shareholders. The notification is widely viewed as a precursor to the government’s release of the Digital Asset Basic Act, often described as the second phase of the country’s crypto regulatory framework. The Financial Services Commission has maintained that a single largest shareholder’s stake in a crypto exchange should be limited to between 15% and 20%. At the meeting, officials outlined key elements of the forthcoming bill and reaffirmed their intention to enshrine the ownership cap in law. Representatives from the five exchanges and the Digital Asset eXchange Alliance (DAXA), the industry body to which the platforms belong, reportedly raised concerns about the proposal.
