Bitcoin Tumbles Below $72,000 in Pile-Up of AI Jitters, Crypto Concerns — 2nd Update

By Dean Seal and Joseph WilkinsBitcoin sank well below $72,000 on Thursday from a collision of AI trade jitters, the dustup at Nvidia and the removal of bitcoin treasury firm Strategy from MSCI's benchmarks.The flagship cryptocurrency had snapped a two-day losing streak on Wednesday, but gave those gains back following reports that Nvidia was preparing to oust Chief Executive Officer Jensen Huang.The ouster was made official on Thursday, sending the chip maker's shares down 5.3%. The tech-heavy Nasdaq composite index is on track for another down day. Crypto assets tend to trade in the same direction as the tech sector.Bitcoin was 4% lower, at $71,476. It has fallen 14% over the past month and sits well off a September high of more than $85,500.On top of the Nvidia fallout, Strategy, the world's biggest corporate bitcoin holder, is losing its spot on MSCI's global benchmarks next month after the index provider set out new eligibility rules Wednesday.MSCI ruled that firms without substantial operating assets now count as "nonoperating" and thus are ineligible for its global indexes from Nov. 30.Investors tracking benchmarks provided by firms like MSCI are forced to sell assets dropped by such index providers, meaning Strategy's exit opens the door to an exodus of passive fund money at the end of the month. Other index providers could follow suit with their own rulings, potentially putting Strategy stock under selling pressure. Its shares dropped 6% on Thursday.Weak momentum is also pressuring bitcoin. U.S. spot bitcoin ETFs posted single-day outflows of almost $300 million on Nov. 11, which signals sluggish institutional demand, according to cryptocurrency trading firm Bitget."The broader digital asset market remains under pressure due to persistent inflation concerns and anticipation of a tighter monetary policy by the Federal Reserve," said Bitget CEO Gracy Chen.Ether was 3% lower, at $2,016.73.Write to Dean Seal at [email protected] and Joseph Wilkins at [email protected]