Bitcoin Mining Shares Tied to AI See 20%-30% Slide Due to Nvidia’s Decline and Market Turmoil

Bitcoin (BTC) managed a modest recovery after dipping below $98,000, trading around $101,500 by midday, though still showing a 3% drop over the past 24 hours. This came as a broader market correction saw the CoinDesk 20 Index fall 5.6%, with notable declines in AI-related tokens like Render (RNDR) and Filecoin (FIL). Solana (SOL), which has been a key player in the crypto AI space, led the losses, experiencing a more than 10% drop.

The drop in prices led to nearly $1 billion in leveraged positions being liquidated across various crypto assets, according to data from CoinGlass. Meanwhile, the Nasdaq 100 dropped 3%, with Nvidia (NVDA) taking the hardest hit, falling 17%, erasing $465 billion in market value. This sell-off further underscored the increasing correlation between Bitcoin and traditional tech stocks, as noted by Geoffrey Kendrick, the global head of digital asset research at Standard Chartered.

Crypto-related stocks also took a beating, with Coinbase (COIN) down 6.7% and Galaxy Digital (GXY) shedding 15.8% of its value. MicroStrategy, the biggest corporate holder of Bitcoin, saw a smaller 1.5% decline.

Bitcoin mining stocks saw even steeper declines. Riot Platforms (RIOT) and Marathon Digital Holdings (MARA) fell 8.7% and 16%, respectively, while miners with a focus on high-performance computing and AI infrastructure, such as Core Scientific (CORZ), TeraWulf (WULF), and Applied Digital Corporation (APLD), saw declines in the 25%-30% range.

Aurelie Barthere from Nansen noted that the market had priced in significant expectations from both the crypto and AI sectors, and the correction was a natural outcome.

Looking forward, market participants are awaiting the Federal Reserve’s meeting and earnings reports from major tech companies. Strong corporate earnings have been reported so far, but the upcoming results from Nvidia and others will be crucial for sustaining the market’s momentum.

Despite the recent downturn, Barthere sees an opportunity for investors looking for high-risk, high-reward altcoins. Specifically, Solana (SOL), with its deeper pullback compared to Bitcoin, may provide a chance for traders to enter at a discount.