Markets
Cryptocurrency wobbles as Nvidia collapse wipes out $500 billion – ‘momentum hype likely over’ – DL News
- Nvidia may have overtaken it.
- This could trigger a sell-off in the tech sector, analysts say.
- However, it could also give crypto an opportunity to take center stage again.
Crypto investors aren’t just dumping their holdings because of Mt. Gox Fears – they also face the idea that the $3 trillion chipmaker Nvidia could have exceeded its revenue.
This could be tumultuous for tech stocks in general, according to Markets.com analyst Neil Wilson.
“The period of hype around momentum is likely over,” he said in a note to clients. A consolidation of portfolios “will make it materially more difficult for the market as a whole to continue to reach new highs over the summer.”
Bitcoin is down 6% since Nvidia hit its high on June 20.
Ether, meanwhile, fell 4%, even as analysts predict that Ethereum spot exchange-traded funds are likely to launch in the next seven days.
Noelle Acheson, former head of market analysis for Genesis Global Trading, agrees.
“When the stock market turns around, we will likely see panic selling in the cryptocurrency sector as well, for no fundamental reason other than emotion,” she said. wrote in its newsletter “Crypto Is Macro Now”. “Maybe the need to raise money for margin calls with whatever we can.”
Acheson noted that Nvidia had reduced its market capitalization by $500 billion, an amount that exceeds the gross domestic product of many even wealthy countries, including Austria.
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“Let that sink in,” she said.
But not everyone is pessimistic. Ram Ahluwalia, CEO of crypto investment advisor Lumida Wealth, argued that crypto could benefit from Nvidia no longer hogging the spotlight.
“The fast money that would normally flow into cryptocurrency is flowing into Nvidia,” he said. published on X two weeks ago.
In other words, as Nvidia continued to reach new highs, market participants looking for quick profits focused on the stock and other AI companies.
Ahluwalia noted that GameStop’s rally in January 2021 had the same effect. While the stock surged 2,065%, Bitcoin consolidated and ended the month at the same price it started.
So Nvidia’s fall could be an opportunity for Bitcoin and Ethereum to grab market attention again, if they can.
“Crypto must come to the forefront now,” Ahluwalia said yesterday.