Bitcoin Holds $64K as Korea’s Chip Crash Leaves Crypto Unscathed

On Wednesday, Bitcoin rose by 1% to around $63,800, even as Asian stock markets experienced significant declines—one of their worst performances this year. This marks the second time in the past week that cryptocurrency has remained stable despite a major sell-off in AI-related investments.

Most major cryptocurrencies increased in value. Ether rose 1% to $1,899, while XRP increased by 2% to $1.07 and BNB climbed to $567. Solana remained steady at $73, and dogecoin saw a slight increase. The only major coin to decrease in value was Hyperliquid’s HYPE, which fell 3% to $54.

Stock market losses were mainly seen among companies that make computer chips. South Korea’s main stock index dropped sharply by 11%, continuing a downward trend from the previous day – putting it on track for its biggest two-day decrease ever. SK Hynix, a major chipmaker, fell around 17% after announcing quarterly profits that, while significantly higher (up 557%), weren’t as high as analysts predicted.

Samsung’s stock rose 12% following their earnings report on Thursday. Meanwhile, Asian markets broadly declined, with the MSCI Asia Pacific index hitting a low not seen since mid-April—down 2%. Tech stocks also struggled, as futures for the Nasdaq 100 dropped 1%, marking the fifth consecutive day of losses for that index, which is its longest losing streak this year.

SK Hynix reported a significant increase in quarterly profit – over six times higher than the previous year. However, its stock price dropped almost 20% as investors anticipated even greater demand fueled by artificial intelligence. This same concern caused a $797 billion loss for major U.S. tech companies last Thursday and is now impacting memory chip manufacturers who provide essential hardware.

For the past month, cryptocurrency prices have generally followed the same pattern as stock prices – going up when tech stocks increased in value and down when they decreased. However, this connection has broken down on two occasions within the last five trading days.

As a researcher, I’ve been closely watching Bitcoin’s recent performance. Interestingly, it barely reacted during last week’s sell-off of the ‘Magnificent Seven’ stocks, and it’s actually gained ground this week. While two instances don’t definitively prove a trend, it’s a pattern I’m definitely keeping an eye on. Also, the demand for Bitcoin mining is still linked to the growth of AI data centers, but the strong downward correlation we saw in July isn’t holding up right now.

As a researcher following the cryptocurrency market, I observed a quick dip in Bitcoin’s price on Monday, briefly falling below $63,000. This happened when the Senate postponed voting on the Clarity Act – a bill concerning market structure. There had been optimism about its passage last week, fueled by reports that President Trump had agreed to certain ethical stipulations, but the delay caused a temporary setback before the price recovered somewhat.

The Federal Reserve will announce its interest rate decision later today. Most analysts don’t expect a rate hike, with around a 15% chance of one happening. We’ll also get important economic data on inflation and GDP, plus earnings reports from several large technology companies.