AI Stock Pressure Spreads to Bitcoin and Crypto Markets
Artificial intelligence stocks faced significant selling pressure on Friday, and this dragged down both tech equities and bitcoin during early U.S. trading hours. I think what’s interesting here is how interconnected these markets have become—when AI-focused companies stumble, it seems to ripple through everything tech-related.
Chipmaker Broadcom, which is actually the ninth largest asset by market cap, dropped about 10% despite reporting strong earnings. The problem was their outlook didn’t meet investors’ high expectations. This disappointment seems to be part of a broader concern that the AI theme, which drove much of this year’s stock market gains, might be losing steam.
Bitcoin’s Pattern of U.S. Session Weakness
Bitcoin was trading around $92,500 overnight but then fell 2% after the U.S. stock market opened, dropping to about $89,800. This continues a pattern we’ve seen all week where bitcoin sets intraday lows during U.S. trading hours. It’s a consistent theme that’s actually led to the filing of that proposed AfterDark Hours ETF, which I suppose makes sense given this pattern.
The connection between bitcoin miners and AI stocks is becoming clearer too. Several miners have been diversifying into AI operations, and they showed similar reactions to Broadcom’s earnings miss. Hut 8 fell more than 5%, while Iren and Riot dropped about 4%. Cipher and Iren were both down around 2% over the past day.
Broader Market Pressures and Fed Uncertainty
Crypto-related stocks followed the Nasdaq lower as well. Robinhood and Strategy were both down nearly 2%, while stablecoin issuer Circle took a harder hit, falling more than 5%. Coinbase dropped slightly too.
Markets were already feeling pressure after Federal Reserve Chair Jerome Powell’s speech on Wednesday. He hinted at a possible pause in rate cuts for January, which shifted expectations—markets now anticipate only two rate cuts in 2026 instead of three. But here’s where it gets a bit contradictory: Chicago Fed President Austan Goolsbee, who opposed a December rate cut, said he expects more cuts in 2026 than the current median projection.
Several other Fed members will speak today since the central bank’s blackout period following their December meeting has ended. Traders will be watching closely for any guidance on whether officials agree with Powell about potentially holding rates steady in January. This uncertainty adds another layer to an already complex market situation.
What strikes me is how these different sectors—AI stocks, bitcoin, crypto equities—are all moving together now. It used to feel like crypto marched to its own beat, but maybe that’s changing. Or perhaps it’s just that when risk appetite declines, it declines across the board. I’m not entirely sure which explanation fits better.
