Koreans Abandon Tesla for Crypto Bets: $657M Exodus Reshapes Markets

Korean retail investors are pivoting from Tesla to cryptocurrency investments, with a $657 million outflow marking the largest monthly divestment since early 2023. This shift underscores waning confidence in Tesla's growth narrative and AI prospects, as competition from Chinese EV makers and Elon Musk's political entanglements weigh on performance.

Once Tesla's most influential foreign retail base, Korean traders now hold $21.9 billion in its shares—still their top foreign equity position, but increasingly seen as a legacy holding. "The AI boom has intensified competition," observes Mirae Asset Securities researcher Park Yeon-ju, noting how Tesla's autonomous driving ambitions are being eclipsed by crypto's asymmetric return potential.

The capital rotation reflects broader skepticism about traditional growth stocks in inflationary environments. Cryptocurrencies—particularly Bitcoin and Ethereum—are absorbing these flows as institutional-grade custody solutions and ETF approvals legitimize digital assets as core portfolio holdings.