The Bank of Korea (BOK) made a rare mention of overseas hedge funds in its semi-annual monetary policy report, warning that overseas derivatives linked to South Korean chipmakers are growing at an unprecedented pace, potentially exacerbating local market volatility. The report noted that Situational Awareness, a U.S. AI hedge fund, utilized leverage of up to four times to trade memory chip positions, becoming one of the volatile factors behind the sharp market decline in July. Meanwhile, BlackRock's U.S.-listed Korean ETF attracted $2.8 billion in a single week in July, while Hong Kong-listed leveraged ETFs tracking Samsung Electronics and SK Hynix saw their market capitalization surge more than 20-fold in the first half of the year, providing more channels for overseas funds to influence Korean stocks. In July, abnormal trading in SK Hynix also triggered nearly $60 million in liquidations in the offshore crypto market, highlighting the issue of cross-market risk transmission. In response, the BOK called for strengthened monitoring of related overseas derivatives.