Crypto mining stocks have closed down for the second consecutive day as major tech stocks regained their footing after the US market was rocked by an artificial intelligence model from China’s DeepSeek, triggering concerns about the overvaluation of the country’s AI scene.
Crypto mining firm Riot Platforms (RIOT) closed down 4.37% on Jan. 28, while rival Cleanspark (CLSK) dropped 2.47% and MARA Holdings (MARA) dipped 0.14%, according to Google Finance.
NVDA sees biggest rebound
Chipmaker Nvidia (NVDA) saw the biggest rebound among the “magnificent seven” top US tech stocks, closing the day up over 8.8% after dropping 17% on Jan. 27.
The extended crypto miner stock losses come as many miners have been switching out swathes of their available computing power to help run and train AI models as the difficulty of mining Bitcoin (BTC) grows and competition tightens.
NVDA’s stock price surged 8.82% during the trading day but dipped by 0.95% in after-hours trading. Source: Google Finance
The US market on Jan. 27 saw billions of dollars wiped out amid concerns that the biggest AI-driven tech stocks might be overvalued after DeepSeek claimed that its new R-1 chatbot developed for just $6 million could rival OpenAI’s ChatGPT.
Also on Jan. 28, Apple (AAPL) rose 3.65%, Amazon (AMZN) climbed 1.16%, Meta Platforms (META) gained 2.17%, Microsoft (MSFT) added 2.87%, and Google parent Alphabet (GOOG) grew 1.70%. The S&P 500 recorded its “3rd largest single-day market cap gain for a stock in history,” macro resource account The Kobessi Letter said on X.
“The S&P 500 closes +55 points higher and is now 1% away from a new all-time high,” it added.
AI crypto tokens continue decline
Leading AI-related crypto tokens suffered further losses, with the sector’s market capitalization dropping 5.11% in the past 24 hours to $42.33 billion, according to CoinMarketCap.
The recently launched Venice Token (VVV), a startup that claims it allows private access to DeepSeek’s AI model, led the losses among AI tokens over the past 24 hours, plunging 20.29%.
Related: Despite Bitcoin’s surge, mining stocks struggle to match gains in 2024
AI agent platform Virtuals Protocol (VIRTUALS) also dropped 11.75% over the same period.
Meanwhile, Bitcoin (BTC) continues to hover near the critical $100,000 level amid speculation that the Federal Open Market Committee may not lower interest rates on Jan. 29 — an outcome many crypto market participants had hoped for.
CME FedWatch says the future market’s implied odds give a 99.5% chance that the Fed will keep its interest rates unchanged at 4.25% to 4.50%.
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