Cryptocurrency-related U.S. stocks fell in premarket trading as market participants continued to digest President Donald Trump’s selection of Kevin Warsh as his nominee for Federal Reserve Chairman on Friday, which spilled over into a sharp decline in cryptocurrencies over the weekend.
Bitcoin’s largest publicly traded holder, Strategy (MSTR), fell more than 6%, and Galaxy Digital (GLXY) fell more than 7%. Bitcoin BTC$77,528.46 Mining and AI-related companies also slumped, with IREN and Cipher Mining (CIFR) both down about 4%. Cryptocurrency exchange Coinbase (COIN) also fell by about 4%.
Volatility continues to rise, with the Volatility S&P 500 Index (VIX) up 10% on the day. The Volmex Implied Volatility Index has skyrocketed over the past week, rising from 40 to 50. Implied volatility reflects the market’s expectations of future price movements, and higher readings indicate that traders are pricing in more uncertainty and larger moves ahead.
Bitcoin is trading around $77,000, up about 1% on the day, after falling to $74,500 on Saturday. Precious metals remain under pressure, with gold down 4% to $4,700 an ounce and silver also down 4% to $82 an ounce. The oil is also weak. West Texas Intermediate futures fell 5% to $62 a barrel.
In contrast, U.S. stock index futures recovered slightly, with the Invesco QQQETF (QQQ), which tracks the Nasdaq 100 index, down less than 1% in pre-market trading.
The DXY index, which measures the dollar’s strength against a basket of major currencies, retreated slightly to 97. CoinDesk Research noted that Bitcoin and DXY showed a clear inverse correlation last week. Bitcoin is rising again as the dollar weakens.
