Bitcoin Slides as Tech Rout Spreads From Wall Street to Asia

Gerik

Summary:

Bitcoin fell sharply and Asian markets weakened after heavy losses in U.S. technology stocks reignited global risk aversion, dragging cryptocurrencies and equities lower at the same time.....

Global Risk Sentiment Turns Cautious

U.S. futures and Asian equities traded mostly lower on Friday, extending losses from Wall Street as another wave of selling hit technology stocks. The pullback reflected growing concern over whether massive artificial intelligence investments by major technology firms will deliver returns quickly enough to justify current valuations. That uncertainty spilled across regions, pushing investors toward a more defensive stance.

Bitcoin also weakened alongside equities, reinforcing the perception that cryptocurrencies are behaving more like high-risk assets than safe havens during periods of market stress.

Bitcoin Gives Back Trump-Era Gains

Bitcoin dropped about 9% in early Asian trading, hovering just under $65,000 after briefly falling more than 12% below $64,000 a day earlier. The move leaves the cryptocurrency trading at roughly half of its record level above $124,000 reached in October. The entire rally that followed the election victory of Donald Trump has now been erased.

The decline reflects dimming enthusiasm as investors reassess the impact of tighter financial conditions, fading momentum, and heavy positioning built up during the earlier rally. Rather than acting as a hedge, Bitcoin has moved in tandem with risk assets during the technology-led sell-off.

Mixed Performance Across Asian Markets

Asian equity markets showed broad weakness, though the degree varied by country. Japan’s Nikkei 225 managed to recover modestly, rising 0.5% as technology-related stocks rebounded from earlier losses. SoftBank Group gained nearly 2%, while Tokyo Electron advanced more than 3%. Political developments also drew attention, with Japan heading into a general election in which Prime Minister Sanae Takaichi is seeking a stronger mandate.

In contrast, South Korea’s Kospi fell 1.7%, weighed down by technology shares. Samsung Electronics declined nearly 1%, while SK Hynix also traded lower. Hong Kong’s Hang Seng Index dropped 1.2%, while mainland China’s Shanghai Composite was little changed. Australia’s S&P/ASX 200 slid 1.6%, reflecting weakness across multiple sectors, and Taiwan’s Taiex edged down slightly.

Wall Street Losses Set the Tone

The negative lead came from U.S. markets, where all three major indexes closed sharply lower. The S&P 500 fell 1.2% for its sixth loss in seven sessions, while the Dow Jones Industrial Average dropped a similar amount. The Nasdaq Composite led declines with a 1.6% fall as technology stocks remained under pressure.

Several high-profile names weighed on sentiment. Qualcomm sank 8.5% despite beating revenue expectations, as investors focused on cautious outlook signals. Alphabet slipped as markets reacted to its heavy AI spending plans. Amazon fell sharply in after-hours trading after announcing a major increase in capital expenditure focused on AI and infrastructure.

Concerns were further amplified by developments in the AI space, including new tools from Anthropic that raised fears of disruption across traditional software and services, adding to pressure on tech valuations.

Commodities And Currencies Reflect Volatility

Safe-haven assets also showed sharp swings. Gold prices fell around 1% to about $4,843 per ounce after nearing $5,600 last week, while silver dropped more than 6% to roughly $71 per ounce following extreme volatility earlier in the week. Oil prices edged higher, with U.S. crude trading above $63 a barrel and Brent near $68, suggesting energy markets were less affected by the equity sell-off.

In currency markets, the U.S. dollar weakened slightly against the Japanese yen, while the euro edged higher against the dollar, reflecting shifting risk sentiment rather than a clear macroeconomic trigger.

The synchronized decline in technology stocks, cryptocurrencies, and several Asian equity markets highlights how tightly linked global risk assets have become. With uncertainty lingering over AI investment returns and financial conditions still restrictive, markets remain vulnerable to further volatility. For now, Bitcoin’s slide alongside equities underscores that investor confidence, rather than isolated asset-specific factors, is driving the current market mood.

Source: Bloomberg

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