Asian tech markets experienced one of the sharpest two-day drops this year, fueled by disappointment in chip makers' earnings, but bitcoin and other cryptocurrencies remained resilient.
While Asian stock markets experienced one of the worst selloffs of the year on Wednesday, bitcoin rose one percent to approximately $63,800, signaling a potential weakening of the correlation between cryptocurrencies and AI-related tech stocks, reports CoinDesk.
South Korea's benchmark Kospi index plunged on Wednesday, July 29, 2026, by five percent according to Tportal data, adding to a ten percent drop the previous day. CoinDesk, however, reports an even more dramatic 11 percent drop on Wednesday, also following the same percentage on Tuesday. Regardless of the differences in precise figures, both sources confirm it was a historic two-day loss.
The main culprit is memory chip maker SK Hynix. Although the company reported spectacular quarterly profit growth of 557 percent year-over-year (or six times higher operating profit according to Tportal), the results fell short of overly inflated investor expectations. SK Hynix's stock fell nine percent according to Tportal, or about 17 percent according to CoinDesk. Samsung dropped 12 percent ahead of its own earnings report on Thursday.
The MSCI index of Asia-Pacific stocks excluding Japan slipped one percent on Wednesday (according to Tportal), or two percent (according to CoinDesk), after a 3.6 percent drop the previous day, and is on track for a monthly loss of eight percent. Tokyo's Nikkei fell 2.86 percent.
The key trigger for the selloff is growing doubt about the massive capital investments in artificial intelligence, which have not yet yielded significant returns in revenue.
"With this week's Fed meeting and earnings reports from US tech giants, along with expectations that capital investments in AI have increased, investors are inclined to sell stocks and thus reduce their risk exposure," said Gary Tan of Allspring Global Investments to Tportal.
Nervousness was heightened last week by Alphabet and Tesla, members of the "Magnificent Seven," which reported negative cash flow due to large AI investments. Just last Thursday, July 23, 2026, the largest US tech stocks lost $797 billion in market value. An additional key test for investors will be the earnings reports of Microsoft and Meta later in the day, while Samsung's results are expected on Thursday.
While chip stocks were sinking, cryptocurrencies posted modest gains. With bitcoin at approximately $63,800, ether rose one percent to $1,899, XRP added two percent to $1.07, BNB strengthened to $567, solana held steady at $73, and dogecoin also saw slight gains. The only major loser was Hyperliquid's HYPE, down three percent to $54.
This is already the second time this week that crypto has weathered a sharp pullback from the AI trade. Bitcoin barely budged during last week's selloff of the "Magnificent Seven" and is now in the green through this one. CoinDesk notes that the pattern is worth watching, although two instances do not yet mean a proven decoupling.
Meanwhile, on Monday, July 27, 2026, bitcoin briefly dipped below $63,000 after the Senate delayed the Clarity Act, a law on crypto market structure whose chances of adoption had risen last week following reports that President Trump agreed to ethical provisions.
The Federal Reserve (Fed) was scheduled to announce its interest rate decision on Wednesday, with markets assigning only about a 15 percent probability of an increase. Most investors expect rates to remain unchanged. Currency markets were subdued ahead of the announcement, with the dollar index at 101.38 points, its highest level in a month. The dollar reached a 40-year high against the yen at 163.74 yen, and a one-month high against the euro at $1.1389 per euro.
