Bitcoin slides as global chip rout triggers circuit breakers

Bitcoin fell below $64,000 on Tuesday, extending a selloff fueled by a global semiconductor rout and renewed geopolitical uncertainty surrounding U.S.-Iran tensions. The decline mirrored broad risk-off sentiment across financial markets, with South Korea's Kospi triggering a circuit breaker after plunging more than 8% in morning trading.

Chip Selloff Cascades Through Markets

The catalyst for Tuesday's market turbulence was a deepening selloff in semiconductor stocks that began on Wall Street and cascaded through Asian markets. South Korea's benchmark Kospi fell as much as 11%, with Samsung Electronics and SK Hynix dropping 9.45% and 11.01% respectively, according to Reuters. A circuit breaker was activated after the index sustained losses exceeding 8% for more than one minute — the eighth such halt this year.xinhuanet+1

Japan's Nikkei 225 also plunged more than 2,000 points at the open as investors dumped AI and semiconductor-related shares. The Nasdaq Composite had ended the prior session down 0.2%, dragged lower by chipmaker stocks.facebook+1

Geopolitical Tensions Add Pressure

President Donald Trump warned over the weekend that military action against Iran could resume if negotiations fail, adding to the risk-off mood. "There is a good chance of a breakthrough," Trump said during the pause in U.S. military strikes, while cautioning that force remained on the table. The remarks came as the U.S. pulled back strikes to give more time for diplomacy and conserve munitions.aljazeera+1

The geopolitical uncertainty has fanned inflation fears as global oil prices surged, compounding pressure on risk assets including cryptocurrencies.xinhuanet

ETF Outflows and Liquidations

The crypto market entered the week on fragile footing. U.S. spot Bitcoin ETFs recorded more than $465 million in net outflows on July 23 and 24, snapping a seven-session inflow streak, according to Bloomberg. CoinDesk reported that despite the late-week drawdowns, the ETFs still logged their third consecutive week of net inflows at $33.79 million through July 24.coindesk+1

Bitcoin had rallied to a July high above $66,500 before retreating below $64,000 by late last week. Analysts are closely watching key support levels, with $63,800 identified as a resistance-turned-support threshold and $58,000 as the next major floor. The Federal Reserve's rate decision on Wednesday looms as a further catalyst, with markets pricing in a potential quarter-point hike in September.cnbc+2