Why $650B in AI Plans Sank Tech and Crypto

The Nasdaq Composite fell 4.2% in a single session, its worst drop since April 2025. Investors reassessed the returns from hundreds of billions of dollars in planned AI infrastructure spending during the same period.

Microsoft, Nvidia, Oracle, Meta, Amazon, and Alphabet have collectively flagged AI-related capital expenditure plans exceeding $650 billion for 2026. The S&P 500 fell 2.64% on the same day.

The concern is not that AI technology fails to deliver on its technical promise. It is that the pace of spending has outpaced any visible revenue lift from those investments. Power constraints and engineering talent shortages have pushed costs higher, while pricing models for AI services remain untested at scale, analysts at several firms wrote in recent notes.

Bitcoin traded between $62,000 and $67,000 during the selloff. The move tracked the Nasdaq closely. Ethereum followed a similar path. The correlation between the two asset classes has been tight in 2026. Crypto has behaved more like a leveraged proxy for equity risk appetite than an independent hedge.

The dynamic is partly a competition for capital. When institutional investors reduce exposure to risk-on assets, they tend to sell both tech equities and crypto positions rather than rotate from one to the other. Cash and bonds have been the main beneficiaries of the June risk-off move.

Microsoft's Alpha Score sits at 51, labeled Mixed, according to AlphaScala data. Nvidia's Alpha Score is 70, labeled Moderate. Both stocks fell today, with Microsoft down 3.18% and Nvidia off 0.97%. See the MSFT stock page and NVDA stock page for details.

The Federal Reserve's next rate decision is due June 20. Market pricing implies a 25-basis-point hike at that meeting, according to CME FedWatch.