Bitcoin (BTC) managed a minor bounce from its lowest levels of the day, yet the bitcoin mining stocks saw no reversal in their steep declines. Concerns were raised by Chinese AI startup DeepSeek regarding the perceived value of crypto miners as data center operations, contributing to a challenging environment for investors.
The largest cryptocurrency was recently trading at $101,500, recovering from earlier lows around $98,000, but still marking a 3% decline over the past 24 hours. The broader market gauge, the CoinDesk 20 Index, dropped 5.6%, largely due to significant losses in AI-related tokens such as Render (RNDR) and Filecoin (FIL), both experiencing double-digit declines. Similarly, Solana, a major hub for crypto AI agent tokens, fell over 10%.
This sharp downturn saw nearly $1 billion in leveraged derivatives positions liquidated across various crypto assets, according to CoinGlass data.
The Nasdaq composite also faced significant losses, closing 3% lower, with technology giant Nvidia notably dropping 17%, wiping out $465 billion of its market value in just one day. This movement underscores a tight correlation between bitcoin and tech stocks, as noted by Goeffrey Kendrick, Standard Chartered Bank’s head of digital asset research.
The extensive market pullback also affected crypto-adjacent stocks; crypto exchange Coinbase (COIN) and investment firm Galaxy Digital (GXY) closed down 6.7% and 15.8%, respectively. In contrast, MicroStrategy, the largest corporate holder of bitcoin, experienced a relatively modest decline of 1.5%.
Crypto Mining Stock Rout
Bitcoin mining stocks faced even steeper losses, with key players Riot Platforms (RIOT) and MARA Holdings (MARA) dropping 8.7% and 16%, respectively. Companies that pivoted towards high-performance computing for artificial intelligence (AI) training, such as Core Scientific (CORZ), TeraWulf (WULF), Bitdeer (BTDR), and Cipher Mining (CIPH), as well as Applied Digital Corporation (APLD), saw their shares plummet by 25%-30% throughout the day.
Aurelie Barthere, principal research analyst at blockchain intelligence firm Nansen, remarked, “It seems that both the crypto markets and AI supply chain-linked stocks — like the Nuclear ETF, which had risen 20% over the past month leading up to today — reached a point necessitating an ‘event’ to catalyze profit-taking corrections after a considerable amount of ‘good news’ had been priced in.”
Looking ahead, market participants will be focusing on this week’s Federal Reserve meeting and the earnings reports from major tech firms. While corporate earnings have been robust thus far, Barthere noted that upcoming results from Nvidia and other major technology players will need to exceed expectations to maintain market momentum.
This recent selloff presents a potential opportunity for altcoin investors who may have missed the initial crypto rally following Donald Trump’s election victory. Notably, higher-beta crypto tokens like Solana (SOL) have experienced steeper declines compared to BTC, making them attractive for opportunistic investors.
For further insights, read more: Bitcoin’s DeepSeek-Triggered Selloff Is a Buy the Dip Opportunity, Analysts Say
