Bitcoin gains 9%, Ethereum 20% in July as chip stocks crash 22%

Bitcoin rose 9% and Ethereum gained 20% in July, beating every major market as the Nasdaq 100 fell 9% and chip stocks tumbled 22%.

"The divergence reflects a rotation out of crowded tech trades into assets that have already repriced lower," Nina Volkov, bitcoin macro analyst at Edgen, said. "Crypto had its washout last year — semiconductors are having theirs now."

Bitcoin traded near $64,900 as of 14:00 UTC on July 30, according to CoinGecko data, while Ethereum changed hands around $3,350. The Philadelphia Stock Exchange Semiconductor Index dropped 22% in July, its worst monthly performance since 2022, as Nvidia Corp. and Advanced Micro Devices Inc. led declines on concerns about AI capex sustainability and export controls. The S&P 500 fell 3.2% over the same period.

The performance gap raises the stakes for the Federal Reserve's July 29 rate decision, where Chair Kevin Warsh faces a divided committee. CME FedWatch data showed 31.5% odds of a hike, with three or four voting members ready to push for an increase, according to CNBC. A hold could weaken the dollar and provide further tailwinds for risk assets, while a surprise hike would test whether crypto's relative strength can withstand tighter liquidity.

Macro and regulatory backdrop improves

The CLARITY Act, legislation aimed at establishing a clearer regulatory framework for digital assets in the US, continued to advance through July, providing institutional investors with greater policy certainty. The bankruptcy filing of Poolin — once one of the world's largest bitcoin mining pools — was absorbed by markets without triggering a broader selloff, a sign of maturing market structure.

Corporate treasury selling remained a factor. Satsuma Technology liquidated its entire 668 BTC holdings after shareholders voted 90% in favor, while Strategy Inc. sold no bitcoin in the last four weeks and instead raised $466.7 million through stock issuance to build a $3.2 billion cash reserve. Despite the absence of fresh buying from the largest corporate holder, bitcoin held above $62,200 support through the month.

Ethereum leads on DeFi recovery

Ethereum's 20% gain outpaced bitcoin by more than 2-to-1, driven by a recovery in on-chain activity across Ethereum DeFi protocols. Total value locked on Ethereum rose to approximately $52 billion in July, up from $46 billion at the end of June, according to DefiLlama data. The ETH/BTC ratio climbed from 0.048 to 0.052 during July, its first monthly increase since March.

The next catalyst arrives Aug. 12, when the Bureau of Labor Statistics publishes July inflation data. Another soft energy print would defuse the hawkish case at the Fed and potentially weaken the dollar, historically a tailwind for bitcoin. The next Federal Open Market Committee meeting is scheduled for Sept. 15-16.

This article is for informational purposes only and does not constitute investment advice.