The cryptocurrency market is experiencing a downturn, with crypto-related stocks declining across the board, particularly affecting exchanges, following Robinhood's earnings miss and escalating US-Iran tensions. Robinhood, a digital brokerage firm, saw a nearly 14% decline after reporting a 47% drop in crypto-related revenue in the first quarter. This weakness has spread throughout the sector, with Coinbase and Bullish, an institutional-focused exchange, both falling by 8%.
Gemini, an exchange business owned by the Winklevoss brothers, dropped 6%, while bitcoin miners Riot Platforms and MARA slid 6%-7%. Strategy, the largest corporate bitcoin owner, was down 4%. The decline in crypto stocks was more pronounced than the decline in crypto prices, with bitcoin edging below $76,000, down 0.5% over the past 24 hours. The rejection of Iran's proposal by President Trump has added to the pressure, with the proposal involving the reopening of the Strait of Hormuz in exchange for delaying nuclear negotiations.
The news has led to a 6% surge in oil prices, with the West Texas Intermediate topping $100 a barrel, due to concerns about the impact on energy supply chains in the Middle East. US stocks have posted modest losses, with the Nasdaq down 0.35%.
The afternoon session is expected to bring more catalysts, including the Federal Reserve meeting results and the earnings reports of big tech firms such as Alphabet, Amazon, Meta, and Microsoft, which will provide insight into their artificial intelligence-related spending.