Bitcoin Holds Firm as Asian Stocks Plummet, Hinting at Decoupling
Bitcoin held steady at around $63,800 on July 29, despite a sharp decline in Asian stocks and artificial intelligence-related shares. This break from its recent correlation with tech equities suggests that cryptocurrencies may be decoupling from their traditional ties to AI and semiconductor stocks.
The cryptocurrency market showed resilience as Asian equities slumped, led by semiconductor stocks. South Korean shares fell 11% the previous day and slid as much as 11% again in intraday trading on July 29, putting the market on track for a record two-day drop. SK Hynix tumbled about 17% after quarterly profit surged 557%, but missed market expectations.
Bitcoin has recently shown a strong correlation with AI and semiconductor shares, but that relationship appears to have weakened in recent trading sessions. During last week's sharp selloff in large US technology stocks, Bitcoin avoided a steep decline. This trend continued as it moved higher during the latest plunge in Asian chip shares.
However, two instances alone are not enough to conclude that a broader decoupling between cryptocurrencies and AI stocks is underway. Attention now turns to the Federal Reserve's interest-rate decision due later on July 29, with markets pricing in about a 15% chance of a rate increase at this meeting.