MarketsSouth Korea's $518 billion investment into AI chips indicates that the cryptocurrency sector is continuing to struggle to attract capital.
Samsung and SK Hynix are advancing their chip plant construction by a decade to satisfy the growing demand for AI memory, marking a significant shift in capital towards AI away from crypto throughout the year.
By Shaurya Malwa Updated Jun 29, 2026, 6:53 a.m. Published Jun 29, 2026, 6:19 a.m. 2 min read
South Korea's leading semiconductor manufacturers, Samsung Electronics and SK Hynix, are set to invest approximately $518 billion to establish four new chip fabrication facilities, aiming to double the nation's DRAM production within five years. This expansion is being expedited by about a decade to meet the soaring demand for AI technology.
A presidential adviser from South Korea indicated that due to the rising demand for AI, the completion of these facilities could be pushed forward to 2034 or 2035, significantly earlier than the previously set target of 2044. In a separate announcement, SK Hynix has revealed plans for a substantial $29 billion IPO in the U.S. to support its growth.
The primary focus is on high-bandwidth memory (HBM), which is essential for AI training and the development of advanced language models utilized in chatbots like ChatGPT and Claude.
SK Hynix has emerged as the leading supplier of HBM, recently becoming South Korea's most valuable publicly traded company, surpassing Samsung for the first time in 25 years. Together, these two companies account for the majority of the global HBM supply and have secured significant supply agreements with Nvidia and OpenAI.
This massive capital influx into AI is creating challenges for the cryptocurrency sector, which has been competing for investor funds throughout the year. The cryptocurrency market has seen declines, even as AI chip stocks have experienced gains, indicating a shift in investor sentiment.
According to Gabe Selby from CF Benchmarks, much of the newly available investment capital and focus has shifted towards AI ventures, leaving cryptocurrencies vying for a reduced portion of investor interest.
This trend is evident in the markets traditionally associated with cryptocurrencies. Recent sell-offs in gold, silver, and bitcoin have seen liquidity moving into AI stocks instead of cryptocurrencies, highlighting a significant change in investment patterns.
Even bitcoin miners are now reallocating their computational resources towards AI hosting, where they find more stable returns compared to the fluctuating revenues from mining.
The $518 billion investment by South Korea is a long-term commitment to AI infrastructure, suggesting that this trend is not merely a temporary spike. Meanwhile, the cryptocurrency sector continues to face challenges as it finds itself on the opposite end of this capital flow. The critical question now is whether this investment in AI will eventually revert back to digital assets or remain firmly entrenched in the tech sector.
Bitcoin is approaching the end of the first half of 2026 below the $60,000 mark, resting near its 200-week moving average, a historical indicator of prolonged downturns, with little support in sight as risk capital continues to favor other areas.
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