Crypto Holds the Bag While Seoul's Chip Party Crashes 📉

Bitcoin climbed roughly 1% to about $63,800 on Wednesday, even as Asian equity markets absorbed one of their worst two-day stretches of the year, led by steep losses in South Korean chipmakers and a record decline in the Kospi benchmark. Ether added 1% to $1,899, XRP gained 2% to $1.07, BNB rose to $567, solana held at $73, and dogecoin edged up, while Hyperliquid's HYPE slipped 3% to $54. Bitcoin BTC $63,800 and major cryptocurrencies have now held through two separate AI-linked selloffs within a week, a pattern analysts flagged as notable even as the correlation that defined much of July appeared to weaken.

South Korea's Kospi plunged 11% on Wednesday after an 11% drop on Tuesday, putting the index on track for a record two-day decline. SK Hynix fell about 17% after reporting a 557% surge in quarterly profit that still came in below expectations, and Samsung slid 12% ahead of its own results on Thursday. The MSCI Asia Pacific index dropped 2% to its lowest since mid-April, and Nasdaq 100 futures fell 1%, extending a five-day losing streak for the tech-heavy gauge — its longest this year.

Earlier in the session, bitcoin had slid about 2.7% to roughly $63,200 from near $65,000 after the U.S. stock market closed Monday, a move that spread to ether (ETH), XRP (XRP), solana (SOL) and other majors as South Korea's index triggered a circuit breaker at the open. Over $670 million in crypto positions were liquidated in 24 hours, including $533 million in longs, according to Decrypt's morning snapshot, which had BTC at $63,400, down 2.7%, with Ethereum at $1,875 (-4.2%) and Solana at $73 (-4.4%).

The U.S. Senate shelved the Crypto Clarity Act to prioritize a Russia sanctions bill and federal nominations, leaving only two weeks of floor time before the Aug. 8 recess begins, with an unresolved dispute over restrictions on government officials' crypto holdings.

Derivatives positioning turned cautious: taker long/short volume in futures flipped to 51.5% shorts, XRP futures open interest rose nearly 6% to 2.35 billion tokens while BTC, ETH and SOL open interest held steady, and the top 25 coins posted negative 24-hour open interest-adjusted cumulative volume delta for the first time in at least three weeks.

"The market is falling out of love with chipmakers at the moment and that's been a big driver of the bull market in South Korea," InvestingLive wrote. "BTC trades with equities when the stress is macro and [interest] rates-driven, and decouples when the stress is idiosyncratic to the equity market," analysts at Bitfinex said in a note to CoinDesk, adding that an earnings-and-capital-expenditure debate is "precisely that."

The Federal Open Market Committee begins its two-day meeting Wednesday, with Fed Chair Kevin Warsh's decision and press conference due July 29; markets expect a rate hold at 3.50–3.75%, though traders remained positioned for volatility ahead of Thursday's Core PCE and GDP releases.