Written by Sam Bourgistaff writerReviewed by Robert Lakinstaff editor

Written by Sam Bourgistaff writer

Reviewed by Robert Lakinstaff editor

Crypto market breakout could accelerate as AI trade cools, analyst says

MarketsPublishedJul 21, 2026

Bitcoin topped $67,000 while crypto stocks rallied on optimism over US crypto legislation and signs investors may be rotating out of AI trades.

Bitcoin and the broader cryptocurrency market looked poised for a recovery on Tuesday as progress on landmark US crypto legislation boosted sentiment, with analysts also pointing to a slowdown in the AI trade as a potential catalyst for capital rotating back into digital assets.

Bitcoin (BTC) briefly climbed above $67,000 and Ether (ETH) neared $1,950, while crypto-related stocks rallied sharply. Coinbase shares rose 12%, American Bitcoin gained 14% and Cipher Digital jumped 17%.

The gains came after US Treasury Secretary Scott Bessent stated lawmakers were at the “1-yard line” on the long-debated CLARITY Act, which would define the regulatory roles of the Securities and Exchange Commission and Commodity Futures Trading Commission over digital assets.

Coinbase (COIN) was among the market’s top-performing stocks on Tuesday. Source: Yahoo Finance

Beyond the regulatory tailwinds, some analysts stated crypto could also benefit from investors shifting capital away from AI-linked equities.

“With Bitcoin at the top end of the range, we see the path of least resistance being higher and an elevated likelihood of a breakout of the range as the AI trade slows and the market becomes more comfortable with the path of interest rates,” FRNT Financial CEO Stephane Ouellette told Bloomberg. 

Related: Hut 8, IREN deals lift AI-focused Bitcoin mining stocks

AI trade loses momentum as chipmakers fall

AI-related stocks have dominated speculative markets over the past year, with the Philadelphia Semiconductor Index (SOX) — a widely watched benchmark for chipmakers powering the AI boom — surging roughly 110%.

nevertheless, the rally has begun to lose momentum. Last week, the SOX index entered a technical bear market after falling more than 20% from its recent high, as investors grew increasingly concerned about lofty valuations and the risk of overcapacity in AI infrastructure spending.

This follows an extended period in which AI largely overshadowed digital assets. Since the launch of ChatGPT in late 2022, a wave of innovation, venture capital investment and retail enthusiasm has shifted much of the market’s speculative appetite toward AI.

Source: Milk Road

Related: Will the US get CLARITY this week? Bitcoin’s new $80K target: Hodler’s Digest, July 19

This article is produced in accordance with Cointelegraph’s Editorial Policy and is intended for informational purposes only. It does not constitute investment advice or recommendations. All investments and trades carry risk; readers are encouraged to conduct independent research.

• Bitcoin Price
• Cryptocurrencies
• Stocks
• AI
• Investments

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