Bitcoin Steadies Near $64K as Wall Street Banks Clash Over AI Chip Selloff

Crypto News

Two of Wall Street’s largest banks issued opposing calls on the same artificial-intelligence trade, and the divide now sets the tone for global risk appetite. JPMorgan told clients that the recent selloff in AI chip shares is a buying opportunity rather than a warning, arguing that demand for advanced semiconductors remains strong while supply stays tight. The bank does not expect meaningful new chip capacity to reach the market before 2028, a shortage it says hands manufacturers durable pricing power. On that basis, JPMorgan favors chipmakers over the large cloud providers, and expects global equities to print fresh all-time high levels in the second half of 2026.

Morgan Stanley reads the same tape differently. Chief investment officer Michael Wilson told the bank’s clients that momentum behind semiconductor stocks is fading after they led the entire 2026 advance, and that the trade is rotating toward names that lagged the rally. His team flags that chipmaker earnings estimates have been revised higher so quickly that they now sit at historic extremes, a setup that has historically preceded disappointment. Rather than adding to the winners, Wilson advises investors to move on, positioning for a handoff in leadership rather than a continuation. The disagreement, notably, is about timing and sequencing — not about whether the AI build-out itself endures.

The sharpest data point in Wilson’s case is a disconnect between spending and share prices. Hyperscalers such as Microsoft, Amazon, Meta and Alphabet (GOOGL) are committing more capital to AI than ever, with combined capital-expenditure budgets forecast at $805 billion in 2026 and rising to $1.116 trillion in 2027. Yet despite that record outlay, their shares have continued to slip. To Morgan Stanley, that divergence is a warning that the market has already priced in the boom and is now questioning the return on the infrastructure being built. When the biggest spenders cannot lift their own valuations, the rotation Wilson describes gains an evidentiary footing.

Wilson went further, comparing the chip rally to silver’s sharp climb earlier in 2026 and labeling both as liquidity-driven moves rather than durable new trends. That framing matters well beyond equities: a rally powered by abundant liquidity rather than fundamentals tends to unwind quickly once that liquidity thins. It is the same mechanism that governs speculative flows across risk assets, from small-cap semiconductors to the most volatile corners of the altcoin market. If Wilson is right that the AI leaders are simply tiring, the read-through is that the marginal buyer is stepping back — a signal that historically weighs on every liquidity-sensitive trade at once.

For now, JPMorgan’s more constructive stance rests on scarcity. With no significant new fabrication capacity expected until 2028, the bank argues chipmakers retain the pricing power that cloud giants lack, which is why it prefers semiconductors to the hyperscalers spending heavily to rent that compute. The house view expects that dynamic to carry major indices to new highs into year-end. It is a classic supply-side thesis: constrained output, resilient demand, and margins protected by a multi-year bottleneck. Whether that scarcity narrative outlasts the earnings-extreme warning from Morgan Stanley is the question that will define positioning through the second half of the year.

The stakes for crypto sit in that same liquidity question. Bitcoin (BTC) traded near $64,000 as of 23:30 UTC, and our reading of the flow is that the asset remains closely tied to the liquidity impulse now animating the AI trade. When strategists debate whether the marginal risk dollar keeps flowing, Bitcoin and the broader altcoin market sit downstream of the answer. Automated desks and every AI trading bot tracking cross-asset correlations are already positioned for either outcome. A rotation that drains capital from crowded equity winners seldom spares digital assets, while JPMorgan’s fresh-record scenario would loosen the very conditions crypto has rallied on.

Tying these threads together, the JPMorgan–Morgan Stanley split is less a stock-picking dispute than a referendum on liquidity — and crypto sits squarely in its path. COINOTAG’s aggregate market data frames the caution: our Fear & Greed Index reads 27 out of 100, firmly in Fear, while Bitcoin dominance stands at 69.5% and total crypto market capitalization holds near $1.85 trillion. That elevated dominance alongside a fearful tape signals capital huddling in Bitcoin rather than rotating into risk — the crypto mirror of Wilson’s equity warning. Until the AI-liquidity debate resolves, our view is that spot demand and algorithmic stablecoins flows, not chip forecasts, will set the next directional cue.