Crypto stocks went through a sharp dip on Tuesday. Investors dumped technology and risky assets last week after a strong rally driven by a rise in speculation about interest rate cuts, but the momentum was broken violently as traders raised uncertainty ahead of Federal Reserve Chair Jerome Powell’s remarks at Jackson Hole.
Among the most difficult names was Galaxy Digital, the Crypto Financial Services Firm, which earned 10% craters. Coinbase, now part of the S&P 500, has given up on more than 5%, while Etoro has slipped down more than 6%.
Other platforms like Robinhood and Bullish were also dragged down, both of which exceeded 6%. The risk-off mood didn’t even make a new corner in the crypto industry spare.
Cryptocurrency focused on the Ministry of Finance is hammer
Within the growing niche of the Crypto Treasury business, Red has flushed all over the board. The strategy was a company that was rapidly rising in the background, falling 7%.
Sharplink Gaming, a blend of Crypto tools and the world of online sports, lost 8%. Bitmine Immersion, tied to mining infrastructure, was 9% sank. However, Defi Development won the crown on the biggest loser of the day, sliding a brutal 13%.
Stablecoins, often considered the mild edge of the crypto space, have not escaped the damage. Circle, the USDC issuer and one of the most closely monitored companies in the space following the IPO, fell 4.5%.
This decline came just days after Circle was soaked in regulatory support under the Genius Act, which established new rules for US Stablecoins.
Pain was not limited to stocks. Bitcoin fell nearly 3%, retreating just over $113,000, while the ether poured over 5%, returning to about $4,100 based on Coin Metrics data. This was a major change since last week when Bitcoin was hit by a record high of nearly $125,000, driven by speculative enthusiasm.
Powell’s uncertainty triggers a tech retreat
The technical name was largely under pressure beyond Wall Street. Nasdaq Composite fell 1.46% to close the session at 21,314.95. The S&P 500 slid 0.59% to 6,411.37.
Nvidia lost 3.5%, while other chip makers such as advanced microdevice and Broadcom fell by 5.4% and 3.6% respectively. One of the top-performing software names of the last quarter, Palantir broke over 9% and finished as the worst performance of S&P.
The Dow Jones industrial average avoided a full-blood shower and finished with a weaker 10.45 points at 44,922.27, but the move came thanks to a lift from Home Depot.
At the heart of the chaos, attention was growing ahead of Powell’s arrival at the Federal Reserve Jackson Hole Summit. Traders were nervous, pulled out of their growth name, and with their speculative nature, the Crypto was a simple first exit.
“As Powell is talking at Jackson Hole, we usually see him benefiting before he says something,” said Satraj Bambra, CEO of Rails, a hybrid crypto exchange. “Whenever there is uncertainty in communication from the Fed, you can generally expect traders to risk their positions and make a profit.”
Over the past few months, crypto stocks have benefited from a series of bullish headlines. Coinbase’s entry into the S&P 500 gave it institutional exposure. Circle’s IPO has added legitimacy to Stablecoins. The act of genius that became law created new clarity, centering on digital tokens. However, the mood changed in August as investors were more clarity and confusion from the Fed.
