Bitcoin dropped to $63,200 from nearly $65,000 late Monday. Any daytime resilience vanished. Asian equity traders unloaded semiconductor shares over fears about the artificial intelligence boom. That panic hit digital assets next. Bitcoin slides 2% after U.S. close. And Korea’s Kospi plunges 10% early Tuesday morning.
Ether, XRP, and solana all posted losses. Across the Atlantic, the U.S. Senate shelved a vote on the CLARITY Act to prioritize a Russia sanctions bill instead. The delay frustrated retail investors. They are stuck. Lawmakers aren’t expected to vote on crypto regulations before next week. They face the final days before their scheduled August 8 recess.
Chinese IPO Triggers Regional Sell-Off
South Korea’s Kospi index hit its lowest level since mid-April: Samsung and SK Hynix saw massive drops. The entire index is now down 25% from its mid-June peak. Japan’s Nikkei 225 fell 3%, and Taiwan’s Taiex dropped 3.8% in early Tuesday trading.
Chinese chipmaker CXMT surged 466% in its Monday trading debut on Shanghai’s STAR exchange. The initial public offering raised at least $8.6 billion. Kim Seok-hwan, an analyst at Mirae Asset Securities, said the market fears CXMT’s capacity expansion will rival Korean companies after the massive public offering. So institutional funds aggressively liquidated their Korean hardware positions. They want to avoid a supply glut.
U.S. futures remained mostly unchanged on Tuesday. Oil contracts dropped more than 1%. Traders are currently waiting for a Federal Reserve rate decision. Analysts predict more volatility later in the week—especially since global interest rates dictate near-term liquidity. That liquidity is exactly what the market is looking for.
CXMT Capacity Challenges Korean Chipmakers
An $8.6 billion IPO from CXMT immediately alters the regional balance of power in semiconductor manufacturing. Samsung and SK Hynix historically dominated the high-bandwidth memory sector. Now a sudden injection of Chinese capital threatens that market share. Retail investors previously assumed the artificial intelligence boom would guarantee infinite demand for Korean chips. But the Kospi drop points to a reversal in that financial consensus.