Nvidia stock decline spurs sell-off in AI crypto projects

The recent sharp decline in Nvidia stock has created a ripple effect across various financial markets, heavily impacting AI-focused cryptocurrency projects.

The overall cryptocurrency market has experienced a bearish trend, continuing a downward trajectory that started during the New York trading session and carried over into the Asian markets.

Over the past 24 hours, the total crypto market capitalisation fell by 6%, hovering around $2.07 trillion.

This drop reflects the uncertainty that has gripped investors amid Nvidia's recent regulatory challenges.

Nvidia, a major player in the artificial intelligence and semiconductor sectors, is currently under scrutiny for possible antitrust violations.

According to a report by Bloomberg, the U.S. Department of Justice (DOJ) has issued a subpoena as part of its investigation into the company’s business practices.

Following this news, Nvidia’s stock experienced a significant downturn, closing Wednesday at $108, down 9.53% from its opening price.

The decline continued in the after-hours trading session, resulting in a staggering net loss of nearly $279 billion.

This decline has not only affected Nvidia but has also had a broader impact on global financial markets.

Nvidia's troubles have rippled beyond the U.S., affecting Asian markets as well.

Japan's Nikkei 225 index fell by 4% over the last 24 hours, reflecting a global market downturn amid fears of further declines.

The broader market anxiety stemming from Nvidia's situation has contributed to the bearish sentiment across various sectors.

The ripple effect of Nvidia's decline significantly impacted AI-focused cryptocurrencies.

Tokens like Bittensor (CRYPTO:TAO), Artificial Superintelligence Alliance (CRRYPTO:FET), Render (CRYPTO:RENDER), and The Graph (CRYPTO:GRT) saw considerable losses following Nvidia's stock plunge.

According to the latest data, the market capitalisation of AI-related crypto assets dropped by 7.4% in the past 24 hours, settling at approximately $20.6 billion.

The daily trading volume for these projects stood at around $1 billion, indicating heightened volatility and caution among investors.

As Nvidia faces potential regulatory challenges, the broader market sentiment remains negative.

This reflects concerns over the interconnectedness of traditional tech stocks and digital assets.

Investors are closely monitoring the unfolding situation, as further declines in traditional markets could lead to additional sell-offs in the cryptocurrency space.