Tom Lee calls the bottom on AI rout as $BTC takes a 4% hit to market hacks

Fundstrat co-founder and Bitmine chairman Tom Lee said the AI stock selloff has reached its bottom, citing continued supply constraints and crypto’s relatively limited response to a multibillion-dollar hack. “I think we're at the bottom,” Lee said during a CNBC interview on Squawk Box. “Bottoms are dangerous because you don't know how much more downside you have at the bottom,” he added. Disclosure: Tom Lee is one of several investors in Dastan, Decrypt’s parent company.

Lee argued that AI is not an overcapacity market despite political opposition and other constraints on spending. “The market for AI is still very tight. It's not an overcapacity market,” he said. Intel illustrated the divide between strong demand and disappointing results: its shares plunged nearly 30% to $65.76 on Friday after a weak fourth-quarter forecast. Its data center and AI revenue rose 78% from a year earlier to $7.3 billion, but manufacturing constraints limited its ability to meet demand. Intel projected quarterly revenue of $15 billion to $16 billion, roughly $1.6 billion below the midpoint of analysts’ expectations, while a weaker PC business added pressure.

Lee also looked to crypto after the Binance security breach, which the exchange initially estimated had affected about $6.3 billion. “If crypto is a leading indicator for risk, you've already seen people sort of washed out,” he said. U.S. spot Bitcoin ETFs recorded $643.2 million in outflows on Friday, according to Decrypt’s ETF tracker, their largest single-day outflow of October. That was their first full session after attackers began draining roughly $6.4 billion from Binance at 4:05 p.m. ET Thursday, following the close of U.S. markets. Thursday’s $17.2 million in inflows predated the theft. Bitcoin ($BTC) fell about 4% to roughly $76,400 on Friday.

A separate analysis from Lee focused on the Nasdaq’s decline, with Intel losing almost a third of its value on Friday and the Nasdaq Composite closing its worst month since March 2025, down 5.3%. The Nasdaq also had its worst day since June 5. Speaking as the index slid, Lee said the market was fighting an “internal battle” and that the selling appeared forced. “Today looks like someone’s getting liquidated. I don’t know if it’s an institution,” he said. He cited an equal-weight version of the S&P 500, which was rising while he spoke but slipped 0.79% by the close, compared with a 1.82% decline in the regular S&P 500.

Lee said large investors were waiting for the November 3 midterm elections before buying, warning that a small selling push could send prices lower. “I think people are marking their calendar until November 3rd,” he added. CNBC’s anchor said markets expected Democrats to edge ahead in both chambers of Congress, a prevailing theory echoed by Steve Sosnick, chief strategist at Interactive Brokers. Sosnick said retail clients had not fled, although they piled into Alphabet on Thursday. CME FedWatch placed the probability of a December rate hike at 72%, while the 10-year Treasury yield closed at 4.93%. Amazon also reported $42.4 billion in negative free cash flow, driven by heavy AI spending. Lee expects buyers to return, with Tuesday’s vote providing the first test.