Markets Swoon as Bitcoin, Tech and Crypto Firms Slide

US equities posted their steepest declines in more than two weeks on Thursday, with selling concentrated in large technology and software names. The S&P 500 fell 1.23% to 6,798.40, its sixth loss in seven sessions, and is now marginally negative for 2026. The Nasdaq Composite dropped 1.59% to 22,540.59, extending its five‑day loss to over 4%. The Dow Jones Industrial Average slid 1.20% to 48,908.72.

Market commentary linked the weakness to a combination of stretched valuations, rising volatility and fresh labor-market data pointing to fragility in cyclicals. Challenger reported a surge in January job cuts, and investors rotated into bonds and the US dollar. The Russell 2000 small-cap index lost 1.8% on the day but remains up 3.9% year-to-date, while transports have held up better, with the Dow Jones Transportation Average up double digits in 2026.

Software stocks were among the worst performers after another round of AI-related headlines heightened competitive concerns. A widely watched interview described the sector as facing a "software Armageddon," with investors worried that enterprises may increasingly build their own AI agents or rely on large model platforms such as OpenAI and Anthropic instead of traditional tools.

Anthropic’s launch of its Claude Opus 4.6 model, described as capable of detailed financial, legal and coding tasks, added to pressure on cybersecurity and enterprise software vendors after it highlighted security use cases. ServiceNow fell 7.60% to $102.63 and Salesforce lost 4.76% to $189.94. Alphabet shares were volatile, ending down 0.60% at $331.33 as investors weighed strong cloud and AI momentum against high capital-spending plans.

Amazon contributed to after-hours volatility. The company reported fourth-quarter earnings that missed analyst expectations despite continued cloud growth, and said it plans capital expenditures of about $200 billion in 2026 to support AI initiatives. Its stock fell roughly 8% in extended trading, with some analysts indicating they will watch whether Amazon Web Services can sustain growth and margins alongside the heavier investment.

Bitcoin fell sharply, dropping below $64,000 for the first time since September 2024 and leaving it almost 50% below its October 2025 record high of $126,198. One market summary estimated that about $200 billion in bitcoin market value was wiped out on Thursday, calling it the steepest one‑day dollar loss for the cryptocurrency on record. Ether and Solana also declined, with Ether down nearly 34% over seven days.

The slide has pushed prominent digital asset treasuries into large unrealized losses. Data compiled by Artemis and cited in press reports showed bitcoin-focused Strategy holding about $9.2 billion in paper losses and Ethereum‑focused BitMine Immersion Technologies down around $8.4 billion on its ETH purchases. Artemis estimated aggregate unrealized losses across tracked digital asset treasuries at more than $25 billion, including positions in Solana, Hyperliquid and BNB.

Prediction markets have begun to price in a higher chance that Strategy may sell some of its 713,502 bitcoin holdings in 2026, with implied odds rising to around 32%. Strategy reported a fourth-quarter net loss of $12.4 billion, or $42.93 per share, on revenue of $123 million, missing earnings forecasts but slightly beating on sales. Its shares fell 17% during the regular session and another 5% after hours.

Publicly traded crypto miners and infrastructure providers also came under pressure. IREN, described as the largest listed miner by market capitalization, reported fiscal second-quarter revenue of $184.7 million, below the roughly $224 million analysts expected, and a net loss of $155.4 million, compared with a $384.6 million profit in the prior quarter. The company said results reflected a shift from bitcoin mining toward AI cloud workloads, with unrealized losses on convertible-note hedges and mining hardware impairments related to an ASIC‑to‑GPU transition in British Columbia.

IREN shares fell 11.5% during the day and another 13% after hours. CleanSpark reported quarterly revenue of $181.2 million, up 11.6% year over year but also short of consensus by about $13 million, and a net loss of $378.7 million versus year‑earlier net income of $246.8 million. Its management highlighted plans to build an infrastructure platform with earnings streams from bitcoin mining, AI workloads and digital asset management.

Crypto‑exposed equities were also hit by forced deleveraging as bitcoin’s decline triggered margin calls in leveraged positions. A market recap noted that bitcoin miner Mara Holdings fell nearly 20% on the day. At the same time, some investors continued to add to the sector: ARK Invest disclosed fresh purchases this week in several crypto-related names, including Coinbase, Bullish, Circle, BitMine and its own spot bitcoin ETF.