NVIDIA's latest decline is adding to pressure on technology stocks and cryptocurrencies as investors confront renewed inflation concerns, higher interest-rate expectations and uncertainty surrounding the chipmaker's leadership. Bitcoin fell below USD 73,000 on Tuesday, while leveraged traders faced substantial losses.
NVIDIA closed Tuesday at USD 168.47, down 5.5% for the session and approximately 10% since Friday. The shares have lost around 18% this month, reaching levels last seen during spring.
The sell-off followed reports of an investigation involving chief executive Jensen Huang and alleged connections to a Chinese spy. President Donald Trump said the FBI was examining the matter and that he had spoken with Huang. These remain reported allegations, not established findings.
Broader technology-sector weakness also reflected concerns that persistent inflation could prompt another Federal Reserve rate increase. Investors consequently reassessed valuations of growth companies and other risk-sensitive assets.
NVIDIA does not control Bitcoin prices. Instead, simultaneous declines can reflect investors reducing exposure across volatile markets. That distinction matters because cryptocurrency prices may diverge from technology shares when liquidity or regulation changes.
Bitcoin touched USD 72,689.38 after October's US consumer price index showed a 0.4% monthly increase, slowing from September's 0.6% but exceeding expectations.
Before the release, Bitcoin remained above USD 74,000 after retreating from nearly USD 75,500 on Monday. It briefly recovered above USD 74,500 before selling accelerated. At the press time, Bitcoin trades at USD 73,733.71 with a decline of 1.39% in the last 24 hours.
The energy component increased 0.7% in October, compared with 5.2% in September, highlighting the continuing influence of oil prices on inflation expectations.
The volatility across Bitcoin and the broader cryptocurrency market before and after the inflation report triggered hundreds of millions of dollars in leveraged position liquidations.
According to CoinGlass, more than USD 169 million in leveraged Bitcoin positions were liquidated over 24 hours, including nearly USD 150 million in long positions. For the second consecutive day, Bitcoin liquidations were eclipsed by those involving Ether (ETH), which totaled just below USD 240 million.
However, it is a sharp decline from over USD 500 million recorded Monday. Overall, cryptocurrency liquidations exceeded USD 632 million over 24 hours, with long positions accounting for more than USD 511 million.
Following the inflation report, the implied probability of a December quarter-point rate increase reportedly climbed from 77% to 85%.
“If services inflation and energy cost pass-through remain elevated, a persistently strong US dollar and high Treasury yields would constrain any recovery in liquidity,” Bitunix analysts warned.
NVIDIA's weakness illustrates wider risk aversion, but inflation, borrowing costs and leveraged positioning remain independent drivers of cryptocurrency prices.
Also Read: NVIDIA Board Probes Jensen Huang as Alice Huang's Chip Deals Face Scrutiny
1. Why did NVIDIA stock decline 5.5%?
NVIDIA shares fell 5.5% to USD 168.47 amid broader technology-sector weakness, renewed interest rate concerns and reports involving CEO Jensen Huang. The stock declined approximately 10% since Friday and around 18% during the month.
2. How is NVIDIA's stock performance affecting Bitcoin and other cryptocurrencies?
NVIDIA's decline reflects broader investor caution toward technology stocks and other risk-sensitive investments, including cryptocurrencies. However, Bitcoin and Ethereum prices are also influenced by inflation, Federal Reserve policy, market liquidity and leveraged trading activity.
3. Why did Bitcoin fall below USD 73,000?
Bitcoin dropped to USD 72,689.38 after October's US Consumer Price Index increased 0.4%, exceeding market expectations. The cryptocurrency subsequently recovered to USD 73,733.71, although it remained down 1.39% over the previous 24 hours.
4. How much was liquidated in the cryptocurrency market?
According to CoinGlass, cryptocurrency liquidations exceeded USD 632 million over 24 hours, with long positions accounting for more than USD 511 million. Bitcoin liquidations surpassed USD 169 million, while Ethereum liquidations approached USD 240 million.
5. How could another Federal Reserve interest rate hike affect Bitcoin?
Higher interest rates can strengthen the US dollar, increase borrowing costs and reduce demand for risk-sensitive assets such as Bitcoin and Ethereum. Following October's inflation report, the reported probability of a December 25-basis-point rate increase increased from 77% to 85%.
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