Bitcoin and other cryptocurrencies such as XRP and ADA fell in tandem, after a drop in Nvidia’s after-hours trading. The company announced that it expects a $5.5 billion write-down in the fiscal first quarter. This announcement was the catalyst for the plunge, fueled in part by new export restrictions on its H20 chip to China. Despite this positive news, it has investors on edge, causing repercussions across the entire crypto space.
NUC stocks tanked Nvidia’s (NVDA) market companion. Nvidia’s share price fell 8% to $89.10 in the wake of this disclosure. This second piece of news, concerning the planned tech export restrictions, seems to have triggered a nor sell-off in the western tech sector. This turmoil had a ripple effect throughout the cryptocurrency market.
Bitcoin, the largest cryptocurrency by market cap, took a huge hit after the announcement. Payments-focused XRP moved in tandem, dropping more than 2% to $2.08. Cardano’s ADA token sank, down 4% to $0.61. The CoinDesk 20 Index, a wider measure of the crypto market, softened more than 2%.
The market was pleasantly surprised today. Investors are now known to be concerned about the potential damage trade tensions and regulatory hurdles may cause technology companies and their supporting industries. What’s more, the ordeal is magnified by a misplaced eagerness for coming proclamations from Federal Reserve bigwigs.
Shortly after, Federal Reserve Governor Christopher Waller cautioned that the bank would need to do some quick “bad news” cuts. This move would come on the heels of a U.S. president reversing the tariff reinstated on April 2. It's worth noting that former President Trump announced sweeping tariffs on 180 nations on April 2, but later suspended them for most nations, excluding China, for 90 days.
"All eyes are on Powell. Markets are holding their breath for Powell on Wednesday. Between the trade war and rising recession chatter, traders are watching for any hint the Fed might be forced to cut sooner than expected," - Secure Digital Markets
Economists surveyed by Dow Jones are forecasting that consumer spending increases 1.2% this month. This is a huge jump up from the weak gain of only 0.2% seen back in February. This data point is being closely monitored for insights into the overall economic health and its potential influence on monetary policy.
Omkar Godbole, a Co-Managing Editor on CoinDesk's Markets team based in Mumbai, is closely watching the market's movements. Godbole has a master’s degree in Finance and is a member of Chartered Market Technician (CMT). Omkar Godbole owns a small amount of bitcoin, ethereum, btt, tron, and dot.
