Crypto mining stocks continued to decline for the second straight day, driven by a resurgence in major tech stocks following turbulence in the US market. This disruption was sparked by the debut of an artificial intelligence model from China’s DeepSeek, which raised concerns about the valuation of AI companies in the country. Riot Platforms experienced a 4.37% decrease in share value, while Cleanspark and MARA Holdings saw declines of 2.47% and 0.14%, respectively.
In contrast, chipmaker Nvidia achieved a remarkable recovery, rallying over 8.8% after a significant drop of 17% the previous day. The recent downturn for crypto miner shares has been exacerbated by many miners reallocating their resources to support the training of AI models, as the complexities of Bitcoin mining increase and competition intensifies.
The market experienced substantial losses on January 27, with billions in value erased amid fears that leading AI-focused tech stocks might be overhyped. DeepSeek’s announcement of a new chatbot, developed at a fraction of the cost compared to similar technologies, stirred additional concern regarding the sustainability of existing valuations. Other tech giants like apple , amazon , Meta Platforms, Microsoft, and Alphabet also saw gains, contributing to the S&P 500’s impressive performance, which approached new all-time highs.
Meanwhile, the market for AI-related cryptocurrencies declined, with a reported loss of 5.11% in market capitalization over the last 24 hours. The Venice Token, a new cryptocurrency claiming private access to DeepSeek’s AI model, led the downturn, plummeting by 20.29%. Additionally, Bitcoin remains near the vital $100,000 level as speculation mounts ahead of the Federal Open Market Committee meeting, with expectations that interest rates will remain steady rather than decrease. Current predictions indicate a 99.5% likelihood that the Fed will uphold rates between 4.25% and 4.50%.
