Eve is here. You really have very poor judgment of how far a maniac can go. I remember back in December 1996 when Alan Greenspan wondered if dot-com prices were a sign of irrational exuberance. When his comments caused the Dow to drop 143 points, Greenspan insisted he would never interfere with that bubble again. Still, it’s surprising how commonplace these delusions are, such as the valuation of companies that clearly won’t make a dime, or how ordinary MBA students can raise $5 million with a five-page proposal for an Internet venture. Now, it takes Ed Zitron and other financial sleuths to try to unravel the deeply unprofitable economics of the former chipmaker and AI company, both due to games like circular lending and covertist reporting methods.
I have omitted the latest in strategic fishing, which I covered in detail when the question first arose.
🚨 Strategy is currently in a very dangerous situation
The company spent $1.38 billion, nearly 61% of its total cash reserves, to buy back the bonds at a discount.
Strategy currently holds $64.8 billion worth of Bitcoin, but only $870 million in cash.
Things could change if there is a sharp fall in BTC… pic.twitter.com/v90DJRfr4b
— Crypto Rover (@cryptorover) May 26, 2026
Another cheerful review is:
There’s a reason why Bitcoin plummeted to $68,000.
History repeats itself.
Bull Trap for $97,000, then $83,000. Exactly as expected.
$BTC is dumped as follows:
$65,000 → $61,000 → $58,000 → $55,000 → $48,000.
Next stop:
→ 60,000 dollars per day.
→ $48,000 by September.
I called the $126,000 high in October 2025… https://t.co/CPDrE1pApp pic.twitter.com/PN30tS9aTH
— Nonce (@0xNonceSense) June 2, 2026
Written by Wolf Richter, editor of Wolf Street. First appearance: Wolf Street
Bitcoin, currently trading at around $63,000, has plunged more than 50% from its all-time high last October and is down 37% year-over-year. Roughly $1.2 trillion worth of Bitcoin was wiped out in terms of the market capitalization of inflation-plagued US fiat currencies.
Ethereum, the second-largest cryptocurrency by market capitalization, has fallen 64% from its all-time high last August and is down 26% from a year ago, erasing $364 billion in market capitalization from its peak.
XRP, another top cryptocurrency by market capitalization, has fallen 68% from its highs last July. Approximately $138 billion disappeared.
CoinMarketCap’s crypto market capitalization index, which tracks all major cryptocurrencies, has plunged $2.08 trillion since October. More than $2 trillion of value, expressed in despised and worthless fiat money, has gone up in smoke. However, no major ripples have occurred outside the crypto world yet.
On the other side of the equation are the huge profits these cryptocurrencies have generated up to last year’s highs. Betting early on these cryptocurrencies is one of the winningest bets of all time. Bitcoin went from zero to a $2.5 trillion market value in about 16 years without having to generate any kind of product or service, revenue or profit, or even financial statements or escort beleaguered analysts to earnings calls.
Thousands of other cryptocurrencies have now emerged to replicate that feat. Cryptocurrency was the best get-rich-quick scheme of all time. However, anyone can create their own cryptocurrency, and there are currently thousands of other cryptocurrencies, many of which are left for dead.
But who needs cryptocurrencies to get rich quick when the tech sector of the stock market offers its services for free and easily?
And there are mega-IPOs coming up, such as SpaceX, which is going to the moon, not just figuratively, but literally, and has already gone to the moon with an IPO valuation of $1.77 trillion. At this price, valued at 93 times trailing 12-month revenue of $18.7 billion, is it time to sell the cryptocurrency to come up with some cash to buy SpaceX to take the next mania to the moon? Thanks to SpaceX, people will be able to get their hands on not only digital units on the blockchain, but also at least some of the current companies with amazing products and innovations.
Or should we sell the cryptocurrencies and buy the semiconductors that are producing amazing charts every day? The other day, we talked about Micron, whose market cap soared from $500 billion to $1 trillion in 48 business days. The stock price has soared more than 850% in 12 months and more than 1,300% in 14 months. Over the past few days, Bara’s stock price has risen further, but today it has fallen a bit.
If you look closely, you can see the dotcom bust, where stocks fell 98% and remained below their 2000 highs for the next 24 years (data from YCharts).
For a closer look at the broader semiconductor field geek: The Direxion Daily Semiconductor Bull 3X Shares [SOXL] It has surged 550% in the past two months since the end of March. Over the past 12 months through yesterday, the stock price had soared more than 1,400%. This means 14 times more. Today, we lost some of that gain.
Similarly, it’s not uncommon for this triple-leveraged semiconductor ETF to drop more than 90%, most recently in 2022. Mathematically, for SOXL to erase its 1,500% gain over the past 12 months, it would have to fall 93% this time.
Is it still a good time to catch up on this mania? This chart shows the growth rate of SOXL and MU over the past 12 months (data provided by YCharts).
Why bet on cryptocurrencies when you can have so much fun, so conveniently, so quickly with semiconductor stocks that have become maniacs and gone parabolic, and triple the fun with a triple leverage ETF?
However, the amount is larger for semiconductor industry and AI-related stocks. Therefore, the dollar value of returns in portfolios is even larger, and those gains are being shown up in widely held, run-of-the-mill ETFs, such as the S&P 500 index fund, which is dominated by 12 stocks with a combined value of $30 trillion. And if it eventually turns south, it will take an even bigger hit in dollar terms.
The 50% drop in cryptocurrencies cost $2 trillion, but caused no ripples outside the crypto industry. A 20% decline in the top 12 stocks by market capitalization, which does not yet include SpaceX, would result in a loss of $6 trillion. The market capitalization of the S&P 500 stocks is now close to $70 trillion. A 20% decline would result in a loss of nearly $14 trillion.
However, like cryptocurrencies, these holdings are spread out not only in the United States but around the world, and some are held by institutional investors as well as individual investors.
As a result, all kinds of damage will be felt not only in the United States but throughout the world, and will be felt not only by individual investors but also by the investor base.
And in the past, a decline of about 20% did not have large economic ripple effects in the United States. However, the even larger decline during the dotcom bust ultimately produced economic repercussions, but most of the economic damage occurred in the cities where these companies were located, and the ripples further afield were minor.
