Global Asset Crash? Silver, Bitcoin Plunge Again, What Is the Reason?

TradingKey - Recently, as the earnings season for AI giants approaches, market concerns over an AI bubble have intensified, triggering a wave of multi-point panic selling in global stock markets, with software stocks suffering the most severe sell-off. The precious metals market has also shown a weak trend, Gold (XAUUSD) and Silver (XAGUSD) faced massive selling pressure once again during a brief respite in their rebound, with silver prices plunging nearly 20% on Thursday.

The situation in the Asia-Pacific region is also not optimistic; the KOSPI Index once plummeted 5%, leading the decline in Asian stock markets. Japanese stocks continued their weakness, with the Nikkei 225 opening more than 1% lower, marking its third consecutive session of decline.

Bitcoin (BTC) crashed during the Asia-Pacific session before staging an intraday V-shaped reversal; it dropped to $60,000 during the session, and the price of Bitcoin has been halved from its peak in October last year.

What Are the Reasons Behind the Crash in Silver and Bitcoin?

The CME Group raised margin requirements for silver, which triggered leveraged liquidations due to its high-leverage nature, leading to panic selling and a stampede among long positions. Meanwhile, this precious metals bull market saw silver prices rise exponentially; such unhealthy gains suggest a significant potential retracement, and from a technical perspective, it is difficult for traders to find effective support levels.

Looking back at cryptocurrencies, Bitcoin continued to fall after consolidating at its peak in the second half of 2025, repeatedly breaking through previous psychological support levels. This sell-off intensified in 2026, with a drop of over 10% in January, and as of February 6, the maximum decline in February has exceeded 20%.

CryptoQuant pointed out: "Institutional demand has undergone a substantial reversal." U.S. spot exchange-traded funds, which purchased over 46,000 Bitcoins during the same period last year, will become net sellers in 2026, offloading 10,600 Bitcoins. This will create "a demand gap of 56,000 Bitcoins by 2025 and exacerbate ongoing selling pressure."

What Are the Reasons Behind the Plunge in U.S. Stocks?

The reasons for the sustained sharp decline in U.S. stocks can be broadly categorized into external macroeconomic factors and internal market dynamics.

U.S. Department of Labor data showed that initial jobless claims for the week ending January 31 also rose more than expected. Additionally, job openings in December 2025 fell to their lowest level since September 2020. This has heightened market suspicion regarding U.S. economic stagnation, with the data indicating a cooling-type weakness in the current U.S. economy.

Furthermore, massive spending on AI has introduced significant uncertainty to the market. Taking U.S. giants Amazon (AMZN) and Google (GOOGL) as examples, Amazon's spending is projected to reach $200 billion in 2026, compared to approximately $131 billion in capital expenditures for the full year of 2025. Meanwhile, Google's spending will reach between $175 billion and $185 billion, doubling from $91 billion in 2025. Following the announcement of their annual expenditure plans, their stock prices plummeted.

Additionally, crypto-related stocks and software stocks continue to lead the decline.

John Praveen, Managing Director and Co-Chief Investment Officer at Paleo Leon in Princeton, New Jersey, pointed out: "There is real concern that AI investments will cannibalize the market share of software companies," which strikes at the core of the tech stock sell-off. There are fears that massive capital expenditures could become a bottomless pit.