South Korean crypto exchange Upbit processed an estimated ₹8,300 crore (₹1.15 trillion won) during one hour of volatile trading on August 22, according to reports from Wu Blockchain. The volume spike occurred around 05:00 UTC when Bitcoin, XRP and other major cryptocurrencies recorded abrupt downward price wicks before recovering part of their losses. The resulting liquidations and rapid repositioning drove spot activity higher across South Korea's largest exchanges. Over the past 24 hours, Upbit's trading volume reached an estimated ₹52.9 trillion (₹5.29 trillion won), highlighting the intense retail participation that characterizes South Korea's crypto market.
The flash crash resulted in $108 billion in shorts liquidated within six minutes and $500 million in long positions within 30 minutes, as reported by AMBCrypto. This represents the largest short squeeze since October 10, 2025, with over $5 billion in shorts squeezed so far in August. Despite the dramatic volatility, Bitcoin has demonstrated remarkable resilience, rising more than 25% this week and maintaining its 21%+ weekly gains. The current short liquidation on an unprecedented scale has created conditions that some analysts suggest could propel BTC into a new bull run, with the scenario suggesting that deleveraging appears to be a buying opportunity rather than a distribution channel.
Bitcoin ETFs recorded their highest inflows day on record this month, with $507 million in inflows on August 19, according to SoSoValue data. The largest Bitcoin ETF, IBIT, led demand with $285 million worth of inflows, attracting 56% of total demand and making it the most popular among investors. IBIT has posted $1.2 billion in inflows this month, suggesting it could have the best month of inflows since May. This institutional accumulation occurs alongside the massive short liquidation, creating what analysts describe as excellent conditions for growth as the bears may have less influence on price while the bulls continue accumulating.
The volume spike followed a 273% daily increase to approximately ₹1,500 crore ($1.84 billion) on August 21, as reported by crypto.news. This was Upbit's highest reported daily volume since mid-March. The recovery came after months of declining South Korean exchange activity, with trading across the country's five won-based exchanges falling 54.6% during the first half of 2026 compared with the previous year. The swift recovery in prices suggests that leveraged positions were liquidated, though the exact trigger for today's drop remains unclear. Bitcoin's technical resilience, with the asset managing to hold weekly gains despite the flash crash, supports the bullish scenario that the current deleveraging represents a buying opportunity rather than a distribution phase.
Despite the volatile session, Upbit strengthened its domestic position, with its share of trading across the five exchanges reaching approximately 67.4% in July, according to crypto.news. The rebound does not yet establish a sustained recovery, as a single volatile session can inflate exchange volume because the same assets may change hands repeatedly. South Korean traders, known for rapid, sentiment-driven reactions to global market moves, responded to today's sell-off by increasing their activity, leading to a surge in transactions on Upbit and other local exchanges. The country's crypto market operates on a premium often referred to as the 'Kimchi premium,' where prices can diverge from global averages due to local demand and capital controls, making it significant for global crypto ecosystem tracking. With technical resilience, strong ETF inflows, and heavy deleveraging, the bullish case appears convincing enough for potential continuation of the current bullish phase.
