Crypto markets reversed course on Thursday, rapidly giving back the strong gains made just a day earlier. Bitcoin (BTC) fell back below $67,000, pulling back more than 4% after touching the $70,000 level late on Wednesday. Major altcoins followed suit, with Ether (ETH) and Solana (SOL) showing similar declines.
The selloff coincided with a broader downturn in technology stocks, as the Nasdaq Composite fell 2% following Nvidia's (NVDA) earnings report. While Nvidia's results met expectations, investors engaged in a "sell the news" reaction after the stock's significant pre-earnings run-up. NVDA itself was down 4.8%, with related semiconductor stocks like Broadcom (AVGO), Micron (MU), and Intel (INTC) also sharply lower.
Curiously, software stocks bucked the trend, with the Software Sector ETF (IGV) gaining more than 2%. This highlighted a frustrating dynamic for Bitcoin bulls: BTC's correlation with this sector appears strongest only when software stocks are falling.
The pullback impacted crypto-related equities. Coinbase (COIN) was down 1%, MicroStrategy (MSTR) fell 2.3%, and Galaxy Digital (GLXY) declined 3%. In contrast, stablecoin issuer Circle Financial (CRCL) continued its post-earnings surge, rising another 3.3% to bring its two-day advance to approximately 40%.
The reversal followed a brief relief rally on Wednesday, February 25th, which had lifted crypto stocks. Bitcoin had rebounded 3.4% intraday to around $65,326 after dipping near $60,000. This rally fueled optimism for crypto-correlated stocks. MicroStrategy (MSTR), the largest corporate Bitcoin holder with over 700,000 BTC, saw its stock rise, buoyed by its recent purchase of $90 million worth of Bitcoin at an average price of roughly $78,800.
Coinbase (COIN) also jumped, fueled by renewed institutional confidence, including a $6.9 million share purchase by ARK Invest. Similarly, Bitmine Immersion Technologies (BMNR), which has pivoted to become a major Ethereum treasury holder with 4.3 million ETH, showed rebound signals aligned with a 5.4% bounce in ETH driven by whale accumulation.