Michael Saylor has amplified a widely shared post from @DocumentingBTC discussing how artificial intelligence could increase Bitcoin’s value, adding influential weight to the growing AI-crypto narrative. The post attracted 193 likes and 40 retweets, underscoring community interest in the intersection of AI and digital assets.
At the same time, China’s AI bubble has suffered a sharp unwind. The STAR50 index of Chinese AI and chip leaders has lost around 40% in under four months, erasing roughly $480 billion in value. Reuters analysis pointed to stretched valuations and Western equipment bans as key drivers. On Tuesday, Cambricon fell another 5.7%, while robot maker Unitree has halved since its August debut. GPU makers MetaX and Moore Threads have each roughly halved since July, and optical suppliers Zhongji Innolight and Eoptolink are down about 60% from summer highs.
The damage has spilled across Asia. SK Hynix has fallen 49.4% since June 30, and South Korea’s KOSPI is down 33.5%. In the United States, the Philadelphia Semiconductor Index has dropped 24.3% from its June high, entering bear market territory, though the Nasdaq Composite is only 5.2% below its record. Polymarket contracts price the odds of a US AI bubble bursting at 9.4% for 2026 and 22.5% by June 30, 2027.
For crypto, the direct impact has so far been limited. Since June 30, Bitcoin has gained 35.7%, Bittensor’s TAO is up 21.9%, and Render has added 9.7%, while FET is flat. Bitcoin’s 90-day correlation with Cambricon is near zero, but its correlation with the Nasdaq 100 is 0.37. AI tokens remain tied primarily to Bitcoin: TAO’s correlation with BTC is 0.71, compared with 0.36 against US chip stocks. Over the past 30 days, TAO lost 25%, FET 29%, and Virtuals Protocol 25%, while Bitcoin fell 6.4%.
Bitcoin is trading near $79,517, down 1.1% in 24 hours and below the 50-day EMA at $80,752. Analysts are watching support at $79,221, with resistance at $81,480 and a deeper floor at the 200-day EMA near $76,379. The key risk for crypto is not China’s localized AI crash but a broader US equity unwind if chip weakness spreads.
