South Korea, President Yoon Suk-yeol Declares Martial Law, Shaking Stock and Crypto Markets

- Declaration of Martial Law Results in Sharp Decline of Won Value, Exchange Rate Rises to 1,420.0 KRW - Crypto Market Plunges, South Korean Cryptocurrency Exchanges Experience Network Disruptions [Unblock Media] South Korea President Yoon Suk-yeol's declaration of martial law is causing significant shock to the economy and financial markets. As of 11:03 PM, the exchange rate against the dollar surged to 1,420.0 KRW, an increase of 18.7 KRW. This marks the highest level in the past two years, indicating a steep decline in the value of the Korean won. Investors are seen reallocating their assets from the won to other currencies like the dollar. The declaration of martial law is based on Article 77 of the Constitution. The President can declare martial law in the event of war, an armed conflict, or a national emergency of a similar magnitude. When this measure takes effect, administrative and judicial powers transfer to the martial law commander, and basic rights such as freedom of the press, publication, and assembly are partially restricted. This is an emergency measure to maintain national security and public order. The cryptocurrency market also suffered immediate impacts. Several cryptocurrencies on major exchanges like Upbit and Bithumb plummeted by 8% to 20%. Specifically, Bitcoin dropped by 8%, Ethereum by 10%, Solana by 11%, Ripple by 20%, and Dogecoin by 15%. The unstable political situation eroded investor confidence, leading to large-scale selloffs and network disruptions that caused delays in transactions. CoinDesk reported that the surge in trading volume on South Korean cryptocurrency exchanges caused server outages, also affecting Bitcoin futures trading. The report suggested that this situation is related to investors' "overreaction to political uncertainty." This marks the first occurrence of such a situation since the democratization of 1987. President Yoon expressed a strong commitment to normalizing the country, stating that the measure is an "inevitable action to protect the freedom of the Republic of Korea and ensure the happiness of its citizens." He also assured that there would be no significant changes in international relations. Foreign media outlet Reuters described President Yoon's declaration of martial law as a "critical test for South Korean democracy," noting that the U.S. government is closely monitoring the situation. The European Union (EU) also issued an urgent commentary, emphasizing the importance of political stability and adherence to democratic procedures in South Korea. The declaration of martial law is expected to adversely affect the domestic stock and bond markets. Increased uncertainty may lead to a freeze in new investments and a rise in selling pressure among existing investors in the stock market. The bond market is likely to face upward pressure on interest rates and significant capital outflows. Data collected over the next 2-3 months is expected to reveal trends in reduced consumer spending, foreign capital outflows, and deteriorating corporate performance. Below is the full statement from President Yoon Suk-yeol on the declaration of martial law: "The National Assembly has so far proposed 22 impeachment motions against government officials since our administration’s inauguration, and following the inauguration of the 22nd National Assembly in June, efforts to impeach 10 more officials are currently underway. This is unprecedented not only in any country around the world but also in the history of our nation since its founding. The judiciary is being paralyzed with threats against judges and the impeachment of a majority of prosecutors. The administration is also being brought to a standstill with attempts to impeach the Minister of the Interior and Safety, the Chairman of the Korea Communications Commission, the Auditor General, and the Minister of National Defense. The nation’s budget process is being manipulated to undermine essential state functions, with all critical funding for anti-drug enforcement and public safety maintenance entirely cut. The country has been turned into a haven for drugs and a state of public safety panic. The Democratic Party has slashed key items in next year’s budget, including ₩1 trillion in disaster contingency reserves, ₩38.4 billion for child care subsidies, and ₩4.1 trillion for projects like youth employment and gas field development. Shockingly, even funds to improve the treatment of junior military officers, such as salary and allowance increases and on-duty service pay, have been obstructed. Such fiscal atrocities are nothing short of national financial mismanagement against the public. By using the budget solely as a means of political warfare, this legislative dictatorship of the Democratic Party has even dared to commit what could be called budget impeachments. Governance has been paralyzed, and the people’s sighs grow deeper. This tramples on the constitutional order of the free Republic of Korea and disrupts legitimate state institutions established by the Constitution and the law, amounting to clear anti-state acts plotting an insurrection. The people’s livelihoods are disregarded, and the country is in a state of paralysis, solely focused on impeachment, special investigations, and shielding the opposition leader. The National Assembly has become a den of criminals, paralyzing the judicial and administrative systems of the state through legislative dictatorship and attempting to overthrow the liberal democratic system. The National Assembly, which should be the foundation of liberal democracy, has turned into a monster dismantling the very system it is meant to uphold. At this moment, South Korea is in a precarious situation, teetering on the brink of collapse. Dear citizens, I hereby declare martial law to protect the free Republic of Korea from the threats posed by North Korean communist forces, to eradicate anti-state forces that shamelessly plunder our people’s freedom and happiness, and to uphold the constitutional order of freedom. Through this martial law, I will rebuild and safeguard the free Republic of Korea, rescuing it from the precipice of ruin. To this end, I will decisively eliminate the destructive and anti-state elements that have been undermining our country. This is an unavoidable measure to protect the freedom and safety of our citizens, guarantee the sustainability of our nation, and pass on a proper country to future generations. I will act swiftly to eradicate anti-state forces and normalize the nation. While I recognize that the declaration of martial law may cause significant inconvenience to law-abiding citizens, every effort will be made to minimize these inconveniences. This measure is solely aimed at ensuring the continuity of the free Republic of Korea. It does not alter our external policy of fulfilling responsibilities and contributions in the international community. As your President, I earnestly appeal to you, the citizens. I place my trust solely in you and will devote my entire being to safeguarding the free Republic of Korea. Please trust in me."