Bitcoin Holds Near $64,000 as Microsoft's AI Payoff Lifts Stocks

Bitcoin traded near $63,900 on Thursday, easing slightly, as U.S. stock futures rose on strong results from Microsoft that reassured investors the heavy spending on AI is starting to pay off, per CoinDesk data. S&P 500 futures gained 0.2% and Nasdaq 100 contracts rose 0.4% after the index had slipped into a correction, with Microsoft up 8% in premarket after its cloud unit grew at the fastest pace in four years while it held the line on spending.

That is the read the market has wanted all month. Where Alphabet last week raised its spending forecast and unsettled investors, Microsoft showed the returns arriving without a bigger bill — a sign that AI capex is converting to growth. Bitcoin has tracked that trade closely, moving with the chip and AI complex rather than on anything crypto-specific, and its move near $64,000 comes as traders are also weighing broader macro signals that have kept risk assets mixed.

Bitcoin Tops $65,000 as Microsoft's 15% Surge Leads Nasdaq Higher

Microsoft (MSFT) — with a market cap of more than $3 trillion — is on track for its largest advance since the wild Covid rally of 2020, up 15% in early trading after its earnings beat last night. That is helping the Nasdaq to more than a 2% gain, even as Meta tumbles 9% after an earnings miss.

AI infrastructure names are reversing their recent plunge, with Micron, SanDisk, Applied Materials, AMD, and Intel all higher by double-digit percentages. Crypto continues to be mostly forgotten about by the hot money, but is seeing a very modest benefit, pushing bitcoin (BTC) back to $65,000, up 0.8% over the past 24 hours.

Apple Slips 2% After Earnings Beat

Apple (AAPL) reported fiscal third quarter EPS of $2.02 versus Street forecasts for $1.89. Sales of $109.4 billion beat estimates for $108.7 billion. Gross margins of 50.1% topped company guidance for around 48%.

At least part of the EPS and gross margin beat appeared to come from tariff refunds. Shares are lower by 2.5% in after-hours trading, but the stock has been a port in the storm during the last few weeks of volatility, rising 15% month-over-month and trading Thursday at very close to a record high.

Strategy Books $8.2 Billion Q2 Loss on Bitcoin Price Decline

Strategy (MSTR), the world's largest corporate bitcoin (BTC) holder, reported Thursday an $8.2 billion second-quarter net loss after the cryptocurrency's price decline erased billions of dollars from the value of its digital asset holdings. The quarterly loss was driven almost entirely by an $8.32 billion unrealized markdown on its bitcoin holdings under fair-value accounting. Shares aren't moving on the news, the loss having already been figured out by investors.

The company held 843,775 bitcoin as of July 26, up 25% from the start of the year. At current prices, the stash is worth roughly $54.8 billion, compared with an acquisition cost of $63.7 billion. The report came after a period of growing investor scrutiny on the firm over whether it can sustain an increasingly complex capital structure built around multiple classes of preferred stock, common equity and convertible debt.

The company raised $17.06 billion through at-the-market stock offerings this year, repurchased $1.5 billion of convertible notes at an 8% discount and expanded its U.S. dollar reserve to $3.75 billion, enough to cover more than two years of preferred dividend payments and interest expenses. "Our USD Reserve currently stands at $3.75 billion, which is enough to cover our existing preferred dividend payments and interest obligations for more than 2.1 years," Chief Financial Officer Andrew Kang said in a statement.

The firm also sold about $218.4 million worth of bitcoin under its new BTC Monetization Program to shore up cash and help fund preferred stock dividends, departing from its long-standing strategy of accumulating bitcoin without selling it.

Executive Chairman Michael Saylor said the company remains focused on expanding what it calls its "Digital Credit" business despite weaker bitcoin prices. "In the midst of this phase of muted bitcoin sentiment and market skepticism, we continue to evolve our business model and establish Digital Credit as a new asset class," Saylor said.

Strategy also established a $1 billion share repurchase program for its MSTR common stock, although it has not bought back any shares. It separately repurchased about $25 million of its STRC preferred shares at a discount to their stated value and said it intends to continue buying the securities while they trade below par.

Coinbase Slumps After Disappointing Q2 Results

Coinbase (COIN) shares fell roughly 5% in after-hours trading Thursday after the crypto platform reported second-quarter results reflecting another weak period for digital asset trading, as lower crypto prices weighed on one of the company's largest revenue sources.

The company had revenue of $1.22 billion, versus consensus expectations of $1.29 billion. Transaction revenue came in at $599 million, compared with expectations of $628 million. Subscription and services revenue totaled $555 million, versus estimates of $599 million, as investors looked for signs that recurring businesses continued to offset weakness in trading activity.

The results came after a difficult quarter for crypto markets. Bitcoin fell roughly 14% during Q2 while ether lost about 25%, reducing both trading volumes and volatility across spot markets. Analysts had expected a slowdown throughout the industry after activity weakened in April and May, although trading improved modestly in June. Robinhood (HOOD), on Wednesday, reported that its revenue from crypto trading fell 38% year over year to $100 million from $160 million.

In a post on X, CEO Brian Armstrong pointed to the company's expanding businesses beyond spot trading, including stablecoins, Base and prediction markets, noting that Coinbase reached a record 10.3% share of global crypto trading volume during the quarter.

CFO Alesia Haas struck a more measured tone, saying crypto market conditions were challenging as industry spot trading volumes fell more than 20% and the total crypto market capitalization declined by double digits. She said those conditions contributed to a 14% quarter-over-quarter decline in Coinbase's total revenue.

Several Wall Street firms lowered estimates ahead of earnings and trimmed EBITDA forecasts as lower crypto prices weighed on institutional trading, blockchain rewards and retail activity. Investors remained focused on Coinbase's efforts to reduce its dependence on transaction fees. Subscription and services revenue, which includes USDC interest income, staking, custody, Coinbase One memberships and institutional services, has become a key measure of whether the company can generate more stable revenue through crypto market cycles. Analysts also watched for updates on newer businesses, including derivatives, prediction markets and Base, Coinbase's Ethereum layer-2 network.

The company will host a call with investors at 5 p.m. ET.

Amazon Books $53.4 Billion Anthropic Gain

Amazon (AMZN) reported second-quarter EPS of $5.75, blowing away estimates for $1.81 after booking a $53.4 billion gain on its investments in AI giant Anthropic. Revenue of $200.6 billion topped forecasts for $195.6 billion, and third-quarter revenue guidance is also ahead of Street consensus. Shares are higher by 6% after-hours.

Leopold Aschenbrenner's Situational Awareness Fund Liquidates Public Portfolio

Leopold Aschenbrenner's AI-focused investment firm, Situational Awareness, has blown up. CNBC's David Faber reported that the fund has exited all of its public investments in "one enormous block trade," with both its longs and shorts sold to another single fund.

Among the longs in which Aschenbrenner and his team suffered large losses are SK Hynix, SanDisk, Micron, and CoreWeave. The fund also lost heavily on its short positions in software companies like Adobe. The aforementioned longs are all higher by double-digit percentages today, while software names are tumbling, including Adobe, down 7%.

Separately, Ken Griffin's investment firm Citadel has purchased a large portion of Situational Awareness' public stock portfolio, people familiar with the matter told the Wall Street Journal. The fund, led by the former OpenAI researcher, had been seeking buyers for its holdings while attempting to raise fresh capital after suffering steep losses on its AI investments, which were once valued at about $20 billion. Despite the sale, Situational Awareness continues to hold its private company investments, including its stake in AI startup Anthropic.

Data Center Names Pull Out of Tailspin

Former bitcoin miners turned AI data center players like IREN (IREN), Hut 8 (HUT), Cipher Mining (CIFR), and Keel Infrastructure (KEEL) suffered crushing declines this week alongside the continued reversal in the AI momentum trade. However, the reported liquidation of Aschenbrenner's fund appears to have given investors the green light to re-enter those popular AI names.

IREN, HUT, CIFR, and KEEL early Thursday are sporting gains of 18%–28%, reversing at least some of the week's losses. Other major advancers include MARA Holdings (MARA), Riot Platforms (RIOT), CleanSpark (CLSK), and Bitdeer (BTDR), all higher by about 20%. Galaxy Digital — which has its own major investments in data centers — is ahead 15.5%.

Treasury Secretary Bessent Urges Passage of Clarity Act on X

Treasury Secretary Bessent took to X to urge Senate passage of the Clarity Act.

"Senate Democrats are choosing politics on the cusp of a major victory for American leadership," Bessent said. "These same Democrats — many of whom have taken millions of dollars from the crypto industry — proclaim that Clarity lacks safeguards for consumers and falls short in countering illicit finance. Nothing could be further from the truth."

"The Senate needs to vote NOW on this landmark legislation … America will lead or America won't. It's not more complicated than that," he continued.

NYSE Owner Expects 'Significant Entities' to Move Onchain by Year-End

Intercontinental Exchange (ICE) CEO Jeffrey Sprecher said during the firm's second-quarter earnings call that "significant entities" could move on-chain by late 2026 or early 2027 as the NYSE parent works with the SEC to tokenize listed securities.

Blockchain cannot replace the NYSE's matching engine, Sprecher said, but could enable round-the-clock settlement, collateral transfers and lending. ICE made a strategic investment and partnered with OKX in March to distribute tokenized NYSE products.

DRW's Don Wilson Expands Case for Perpetual Futures

Don Wilson isn't finished making his case for perpetual futures. Following recent debate over the products, the DRW founder and CEO published another thread expanding on why he believes perps should be regulated like futures, not swaps. His broader argument builds on his previously stated position that regulators are misunderstanding crypto's biggest trading innovation.

Wilson traced the issue back to the aftermath of the Enron collapse and the Dodd-Frank Act, arguing that regulators have long confused legal labels with actual market risk. He said that exchanges like ICE and CME simply reclassified certain centrally cleared "swaps" as futures without changing how the products worked. His broader point is that regulation should follow economic substance and risk, not terminology. If a contract is standardized, centrally cleared and traded on a regulated futures exchange, it should be treated like any other futures contract.

Sticky Inflation Keeps September Fed Hike in Play, 21Shares Says

Today's inflation report offered some relief on the surface, but an underlying measure of price pressures is likely to keep the Federal Reserve on track for hiking rates later this year, according to 21Shares' head of macro Stephen Coltman.

While headline PCE inflation eased, the "supercore" measure — which strips out food, energy, housing and utilities — remained close to 4% year-over-year. "Bond investors are expecting a hike from the Fed in September, and this report will do nothing to change their minds, even with the softer-than-expected GDP number," Coltman said in a note.

After Wednesday's Fed decision to hold rates, market participants assign roughly 60% odds of a 25 basis point hike at the September meeting, CME FedWatch shows.

Markets Get Slightly Better Inflation News

The Core Personal Consumption Expenditures (PCE) Price Index for June rose just 0.1%, better than forecasts for 0.2%, and down from 0.3% in May. On a year-over-year basis, core PCE prices rose 3.3%, in line with forecasts and down from 3.4% in May. While PCE prices are a key inflation gauge looked at by the Fed, this is June data and the calendar is about to turn to August.

In other economic news, the preliminary estimate for annualized second-quarter GDP growth was just 1.5% versus a forecast 2.1%. Initial jobless claims continued at a very slow pace, rising to 197,000 from last week's 188,000.

Markets aren't really reacting. Bitcoin continues with a small gain to $64,800 and Nasdaq futures are higher by 1.7% on the back of a 10% rise in Microsoft following its earnings last night. Bond yields are modestly higher, continuing to digest yesterday's policy hold by the Fed and post-meeting comments from Chairman Kevin Warsh.

Yen Surges Versus Dollar, Suggesting BOJ Intervention

Dollar/yen tumbled — meaning yen rising — more than two big figures in a matter of minutes. The quickness and size of the move suggests intervention by Japanese authorities, i.e. buying yen and selling dollars.

The so-called "carry trade" involves hedge funds and others borrowing in yen to buy dollar-based assets, knowing they can repay those yen at a weaker exchange rate. The unwind of that carry trade — which can be sparked by a large surge in the yen — often forces unsettling selloffs in popular trends, such as the quick plunge in bitcoin in August 2024. For now, markets are continuing higher, with bitcoin pushing up against $65,000 and the Nasdaq up more than 2%.

Real Yield on U.S. 30-Year Treasury Bond Hits Highest Since 2008

Longer-duration U.S. Treasury bonds are increasingly offering yields that more than compensate for inflation. The so-called real, or inflation-adjusted, yield on the 30-year note has risen to nearly 3% for the first time since 2008, according to Bloomberg data. In other words, it's offering a return of nearly 3% in excess of the inflation rate.

That means every dollar sitting in zero-yielding assets like gold and bitcoin, or in risky assets like tech stocks, is a dollar not earning that 3% positive real yield. A continued rise in real yields could create a headwind for other assets.

Dollar Index Drops Despite Hawkish Fed

The Dollar Index (DXY), which tracks the greenback's exchange against major fiat currencies, including the euro, has dropped to 100.67, extending Wednesday's 0.6% slide from 101.49. The decline comes even though the Fed left interest rates unchanged Wednesday in what analysts described as a "hawkish hold."

In the meantime, uncertainty about inflation and policy continues to push longer-duration yields higher. The 30-year yield rose 5.24% early today, the highest since 2007. A weaker dollar supports the bullish case in bitcoin while hardening yields suggest otherwise.

Bank of England Holds Interest Rate at 3.75%

The Bank of England's Monetary Policy Committee voted to maintain its benchmark interest rate at 3.75%, citing a faster-than-expected drop in inflation to 2.6%. The bank, however, forecast inflation will increase later in the year due to high energy prices exacerbated by the conflict in the Middle East.

The 6-3 vote, with the three dissenters all favoring an increase to 4%, contrasts with a 7-2 split at the previous meeting in June.

Aave Proposes Leaving 6 Blockchains After Deposits Collapse

Decentralized lender Aave is considering withdrawing from Sonic, Scroll, zkSync, Metis, Soneium and Aptos after revenue from the deployments fell below their support costs.

The governance proposal covers $98.1 million of supplied assets and $15.6 million of debt across Aave. The six proposed closures account for $12.8 million of supplied assets and $4.1 million of debt. Deposits on Sonic fell 74% over six months to $7.6 million, and Scroll deposits dropped 86% to $2.2 million.

Aave would freeze new activity, reduce supply and borrowing caps and raise interest rates to encourage users to repay loans and withdraw their assets from the networks, which each generate less than $5,000 in protocol revenue.