A broad sell-off is underway in crypto-related stocks, led by exchanges, following a disappointing earnings report from Robinhood and escalating US-Iran tensions. The crypto-friendly brokerage firm, Robinhood, saw its stock plummet nearly 14% after revealing a 47% decline in crypto-related revenue for the first quarter. This triggered a sector-wide downturn, with US crypto exchange Coinbase and institutional-focused exchange Bullish both falling 8%.
Gemini, the exchange business of billionaire investors Cameron and Tyler Winklevoss, dropped 6%. Bitcoin miners Riot Platforms and MARA also slid 6%-7%, while Strategy, the largest corporate bitcoin owner, was down 4%.
The declines in crypto stocks outpaced those in crypto prices, with bitcoin edging below $76,000, down 0.5% over the past 24 hours. President Donald Trump's reported rejection of an Iranian proposal to end the naval blockade and open the Strait of Hormuz added to the pressure. The proposal involved reopening the strait while delaying nuclear negotiations, but Trump opted to maintain the naval blockade until a broader nuclear deal is reached. This news sent oil prices surging 6%, with the West Texas Intermediate topping $100 a barrel, due to concerns about the potential impact on energy supply chains in the Middle East.
US stocks, meanwhile, posted modest losses, with the Nasdaq down 0.35%. The afternoon session is expected to bring more catalysts, starting with the Federal Reserve meeting results, where no change in rates is expected.
Market participants will be looking to the accompanying policy statement and Powell's post-meeting press conference for clues about the future direction. After the US market closes, several big tech firms, including Alphabet, Amazon, Meta, and Microsoft, will report earnings, with traders eyeing their artificial intelligence-related spending as a gauge for the AI trade and infrastructure buildout.