- Nvidia’s stock dropped 9.5%, erasing $279 billion in market cap amid a Justice Department antitrust investigation.
- The Nasdaq and S&P 500 fell over 3% and 2% respectively, triggered by Nvidia’s sharp decline.
- Bitcoin fell to $56,000 as the crypto market experienced a downturn linked to Nvidia’s stock plunge.
Stocks and cryptocurrency prices are crashing, causing severe volatility in the world’s financial markets. The U.S. Department of Justice (DOJ) recently issued subpoenas to major chip makers like Nvidia. The subpoenas are part of a larger investigation into suspected antitrust violations, which raises concerns about the broader market implications.
Nvidia Faces Antitrust Scrutiny
Nvidia is currently under intense examination by authorities due to its dominant position in the artificial intelligence chip industry. The Justice Department’s probe began with questionnaires and has progressed to legally enforceable subpoenas. Officials are allegedly concerned that Nvidia’s business methods could hinder competition by making it tough for customers to switch suppliers.
The Justice Department’s announcement sparked a dramatic collapse in Nvidia’s price, with shares falling by 9.5%, resulting in a staggering $279 billion loss in market capitalization, a record one-day loss for any firm.
Impact on the Broader Market
Major indices in the United States and Asia have also declined. The Nasdaq, which is heavily weighted in technology equities, plunged more than 3%, while the S&P 500 dropped more than 2%.
Asian markets followed suit, with Japan’s Nikkei 225 plunging 3.3% and South Korea’s Kospi down 2.7%.
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Impact on Cryptocurrency
During the market decline, cryptocurrencies have also suffered big losses. Bitcoin, the largest cryptocurrency by market value, plummeted to $56,000, an enormous decline from previous highs. Ethereum (ETH) fell to $2,400, while Ripple’s XRP fell to $0.55.
The sharp declines in the digital assets have raised concerns once again that the cryptocurrency market may undergo a correction similar to the one that occurred from July 22 to August 5, during which time the overall market capitalization fell by 30%.
The ongoing antitrust probe into Nvidia, coupled with the overall market downturn, has created a volatile environment for both traditional and digital assets.
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