[Digital Today Seung-a Yoo, intern reporter] Overseas cryptocurrency investors are increasing trading in domestic KOSPI 200-related investment products.

On May 5 (local time), blockchain-focused media outlet Cryptopolitan reported that trading targeting the KOSPI 200 was increasing on the decentralised derivatives exchange Hyperliquid.

Hyperliquid trading data show about 63 percent of KOSPI 200-related positions were in profit as of that day. Open interest stood at $121,000, still not large. Still, trading started to pick up after the KOSPI broke through a record high, raising the possibility that demand that had remained a niche trade could spread further.

Behind the flow of funds is the KOSPI 200's strong rise. The KOSPI 200 returned 31.84 percent over the past month and more than 209 percent over the past 12 months. Its volatility was also higher than bitcoin (BTC), leading to an assessment that its price moves were comparable to speculative tokens or altcoins. Experts analysed that the KOSPI 200 is drawing in crypto traders through value-based growth rather than pure speculation.

Policy changes are also cited as a factor behind inflows. The government introduced a corporate value-up programme in 2024 to promote improvements in the value of undervalued stocks and encourage a bull market. It then lowered the dividend tax rate in December 2025 to 13 to 30 percent from 45 percent, boosting the investment appeal of domestic stocks. The analysis says the value-up policy is becoming a trigger for a full-fledged price re-rating, based on a view that factors behind the KOSPI's undervaluation stem from corporate governance issues rather than current economic conditions.

Valuations were also highlighted as being closer to a re-rating phase than overheating. The KOSPI's price-to-earnings ratio (PER) is 26.41, similar to the Nasdaq's 23.90 and lower than the S&P 500's 30.90. Continued growth in corporate earnings and relatively less valuation 부담 were also cited as factors drawing traders.

The KOSPI 200 is also drawing attention for its heavy weighting in semiconductors expected to benefit from artificial intelligence (AI). Semiconductor companies such as SK Hynix and Samsung Electronics account for 42 percent of the index. The industry assesses the KOSPI as one of the assets closest to an AI transition, while also arguing it has 'deep value' characteristics rather than bubble-like overvaluation, reinforcing the logic behind the fund shift.

This trend also aligns with broader changes in trading on Hyperliquid. Recent data show stocks and stock indices have overtaken crude futures and precious metals to become the most actively traded asset class. TradeXYZ's S&P 500 index ranked fourth in daily trading volume, behind bitcoin, ether and HYPE.

Diminishing trust in the cryptocurrency market is also mentioned as a reason for the shift. Even profit-making applications (apps) face growing hacking risks and uncertainty, pushing traders to look for more stable sources of growth. Platforms such as Hyperliquid are also expanding choices by offering trading contracts across various assets.

The trend is seen as a sign that crypto derivatives traders are reallocating some funds from speculative tokens to South Korean stocks combining policy benefits, earnings growth and AI exposure. Open interest remains limited, but the view that related trading could increase further if the KOSPI's strength continues is gaining support.