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Deep Sink

DeepSeek news is sinking crypto too, but will the slump last?

While tech stocks may feel lasting pain, experts predict crypto could rebound quickly.

1/27/25 11:41AM

The news that DeepSeek’s new R1 model was created in just two months for under $6 million is triggering a significant sell-off, not only for the tech sector but for the crypto market, too.

The free Chinese open AI model, launched in December, targets competitors like OpenAI’s Chat GPT and Meta’s Llama and has risen to the top of Apple’s App Store. While tech stocks like Nvidia, Microsoft, and Oracle are taking the brunt of the beating, the crypto market is also hurting. As of 11 a.m. ET, crypto’s market cap was down 5.5% in the past 24 hours, according to CoinGecko.

The crypto ecosystem has been on a massive bull run in recent weeks, thanks mainly to Trump 2.0, but today some are panicking as they watch their assets tumble.

“DeepSeek just crashed crypto,” Altcoin Daily said on X.

Bitcoin’s dipped below $100,000 overnight, but has regained some of its losses already. Experts said that while markets have reacted aggressively, this probably won’t affect crypto in the long term.

“While this is bad news for investors in US tech stocks, it’s not bad news for the crypto industry,” said Charles Wayn, cofounder of Web3 infrastructure and digital credential network Galxe.

“Yes, we’ve seen a slide in crypto tokens today, but it won’t last as crypto is the biggest beneficiary of AI technology.”

While the correlation between bitcoin and tech stocks has been strong, hitting a two-year high in January, for most of 2024, the connection had actually broken down.

Several experts echoed the idea that the latest DeepSeek news as good for crypto, predicting the sell-off will ultimately slide off crypto within a day or two.

Kevin Rusher, founder of the real-world asset tokenization platform RAAC, went further.

“Crypto will probably be one of the biggest beneficiaries of growth in AI — wherever it comes from — if it can move blockchain technology forward and open up new possibilities for trading and more,” Rusher said.

“Most likely, we’ll see that reflected in the value of AI tokens over the coming days.”

Yaël Bizouati-Kennedy is a financial journalist who’s written for Dow Jones, The Financial Times Group, and Business Insider.

Sage D. Young5h

Altcoin trading activity has lost its mojo

Non-bitcoin cryptocurrencies have seen their trading volume plummet in the past five months. The combined trading volume of ethereum, XRP, solana, dogecoin, SUI, and chainlink has decreased by 60% since crypto’s October 10 liquidation event, according to Thomas Probst, a research analyst at crypto markets data provider Kaiko.

Main Altcoins Trading Volume in USD — The trading volume of ETH, SOL, XRP, DOGE, SUI, and LINK.

For all altcoins, spot trading volume on Binance has declined between 80% and 85% to $7.7 billion, while altcoin volume on other exchanges has dropped to $18.8 billion, down from a range of $63 billion to $91 billion in October, a Friday report from Decrypt found, citing data from CryptoQuant.

“This trend may be explained by a contraction in market liquidity over the same period,” Probst told Sherwood News. “This phenomenon is also reflected in the average 1% market depth, which stood at approximately $2.6 million before the October 10 crash and is now closer to $1.7 million when aggregated across ETH, XRP, SOL, SUI, and LINK.”

Market depth is used by investors and traders to gauge the scale of liquidity in a market. 1% market depth refers to the amount of liquidity needed to move the market by 1%.

CoinGlass’s Altcoin Season Index, a measure to assess the performance of non-bitcoin cryptocurrencies, has been sitting above 50 this week, suggesting that the current market is neither in a bitcoin dominant phase nor an altcoin season.

“Triple witching” day may put further pressure on bitcoin’s price

This is not “a favorable environment for risk assets.”

Yaël Bizouati-Kennedy7h

Sage D. Young

3/19/26

Hyperliquid is the “1,000 pound gorilla in the room” leading year-to-date market gains amid conflict in the Middle East

While the crypto industry has shed $564.3 billion in 2026, Hyperliquid’s native token has bucked the downtrend and jumped 54.8% year to date.

Yaël Bizouati-Kennedy

3/19/26

Bitcoin tumbles as oil and gas prices spike and the market’s mood turns risk-off

Bitcoin ETFs reverted to outflows and bitcoin suffered $192 million in liquidations in the past 24 hours.

Sage D. Young3/18/26

Payward, parent company of crypto exchange Kraken, puts plans for IPO on hold

Payward, crypto exchange Kraken’s parent company, has paused its plans for an initial public offering until market conditions improve, according to a report from CoinDesk that cited two people with knowledge of the matter.

Since the firm announced in November its preparation for an IPO of its common stock, the total market capitalization of the crypto industry has shed around $652.2 billion, from $3.2 trillion to $2.5 trillion as of Wednesday, data from CoinGecko shows.

The news comes two weeks after Kraken received approval for a master account from the Federal Reserve Bank of Kansas City, allowing the crypto exchange to connect to the Fed’s payment infrastructure used by traditional banks and credit unions.

Last year, Kraken raised $800 million at a $20 billion valuation from institutional investors such as Jane Street and Citadel Securities.

Payward, parent of crypto exchange Kraken, has put its IPO plans on hold