Crypto-related stocks are slumping on Wednesday, with stock markets taking the hardest hit after Robinhood’s revenue shortfall and escalating tensions between Iran and the United States.
Robinhood (HOOD), a crypto-friendly digital brokerage, plunged nearly 14% after reporting a nearly 47% drop in first-quarter crypto-related revenue late Tuesday.
The weakness spread across the sector as investors interpreted it as a signal of lackluster demand for crypto trading. US crypto exchange Coinbase (COIN) and institutional exchange Bullish (BLSH), the parent company of CoinDesk, both fell 8%. Gemini (GEMI), the struggling stock business of billionaire investors Cameron and Tyler Winklevoss, fell 6%.
Bitcoin miners Riot Platforms (RIOT) and MARA (MARA) also fell 6-7%. Strategy (MSTR), the largest company that owns Bitcoin, was down 4%.
The declines were more pronounced than for the prices of cryptocurrencies themselves, such as bitcoin is just under $76,000, down 0.5% over the past 24 hours.
President Donald Trump has reportedly rejected an Iranian proposal to end the naval blockade and open the Strait of Hormuz, a crucial global oil shipping route, adding to the pressure.
The Iranian regime’s proposal involved reopening the strait while delaying nuclear negotiations, but Trump opted to maintain his naval blockade until a broader nuclear deal was reached, Axios reported.
The news sent oil prices up 6%, with West Texas Intermediate surging above $100 a barrel on concerns that Middle East energy supply chains remain under pressure.
US stocks, meanwhile, posted only modest losses, with the Nasdaq down 0.35%.
The afternoon session promises further catalysts, the first being the results of the Federal Reserve meeting. No change in rates will be Jerome Powell’s last meeting as chairman. Market participants, however, will look to the accompanying policy statement and Powell’s post-meeting press conference for clues about future direction.
After the U.S. market closes, a slew of major tech companies, including Alphabet (GOOG), Amazon (AMZN), Meta (META), and Microsoft (MSFT), will release their results. Traders will view corporate spending on artificial intelligence as an indicator of AI business development and infrastructure development.
