South Korean Retail Investors Sell $657M Tesla Stock as Crypto Demand Rises

TLDR

• South Korean retail investors sold $657M Tesla stock in August, the biggest since 2023.

• Bitmine Immersion Technologies drew $253M inflows as a proxy for Ether exposure.

• Tesla remains top foreign stock in Korea with $21.9B still held by retail traders.

• Leveraged Tesla ETF TSLL saw $554M outflow in August, the largest since early 2024.

South Korea’s individual investors sharply reduced their Tesla holdings in August, marking the largest monthly selloff in more than a year. The shift reflects a weakening appetite for the electric vehicle maker and growing enthusiasm for cryptocurrency-linked assets.

Record outflows from Tesla shares

According to depository data compiled by Bloomberg, South Korean retail traders sold a net $657 million of Tesla stock in August.

This represents the biggest outflow since early 2023 and signals reduced conviction among one of Tesla’s strongest global retail bases.

The selling comes after years of steady buying from South Korean traders, who once played a key role in amplifying Tesla’s stock rallies. Analysts note that enthusiasm has waned as the company struggles to maintain the same investor appeal it once commanded.

Shift toward crypto-linked investments

Instead of Tesla, investors turned toward higher-risk alternatives. Bitmine Immersion Technologies, seen by many as a proxy for Ether exposure, drew $253 million of net inflows during August. This reflects stronger demand for digital assets and companies tied to the cryptocurrency sector.

One retail investor, 33-year-old Han Jungsu, said he sold his Tesla shares earlier this year to pursue other opportunities. “Tesla used to offer a lot of inspiring narratives, but it has failed to win people’s hearts,” he said. Han added that the company has not managed to develop a compelling AI story, a theme driving other technology stocks.

Despite the selloff, Tesla is still the most widely held foreign stock among South Korean retail traders. Depository data show that individuals in the country hold $21.9 billion worth of Tesla shares, far ahead of other popular U.S. names. Nvidia and Palantir Technologies remain second and third choices, though their holdings are much smaller.

---

---

The data underline the continuing importance of Tesla in South Korean portfolios, even as sentiment softens. For now, the company’s stock remains a dominant presence in the country’s retail investment landscape.

ETF outflows mirror weaker sentiment

The exchange-traded fund TSLL, which offers double-leveraged exposure to Tesla shares, also saw major outflows. Retail investors pulled $554 million from the ETF in August, the largest monthly withdrawal since early 2024.

The reduction in leveraged bets suggests that investors are not only selling Tesla stock but also stepping back from speculative positions tied to the company’s performance. This aligns with the broader rotation into cryptocurrency-related investments that promise higher short-term returns.

The outflows show that South Korean investors, once among Tesla’s most reliable supporters, are reallocating capital into emerging opportunities. Cryptocurrency-related assets are attracting inflows at a time when Tesla is facing slowing momentum and stronger competition in global electric vehicle markets.

Even with softer demand from retail investors, Tesla remains an influential stock in South Korea. Whether this exodus continues will depend on how the company responds to shifting market narratives and how crypto assets perform in the months ahead.