Blockchains and artificial intelligence are complementary technologies, according to crypto asset manager Grayscale, even as markets have recently treated them as part of the same trade.

Zach Pandl, Grayscale’s head of research, said that while disruptive technologies tend to produce clear winners and losers, the relationship between AI and blockchain is more symbiotic than competitive. Rapid AI adoption is expected to reward some industries, such as chipmakers, while pressuring others, including segments of professional services.

“Although crypto valuations have been tightly correlated with the drawdown in software stocks, we think blockchains and AI are complementary from a fundamental standpoint,” he said in the Wednesday blog post.

U.S. equity markets have lately focused on the downside. The S&P 500 software index has fallen roughly 20% year to date, and crypto valuations have moved closely with the selloff. But Pandl maintains that the parallel drawdown obscures a more constructive long-term dynamic between the two technologies.

Investor anxiety about artificial intelligence’s disruptive potential has sparked a broad sell-off in tech and software stocks, erasing significant market value as traders reassess long-held valuations.

U.S. software and services shares have plunged sharply, wiping out roughly $1 trillion in market capitalization, as fears mount that fast-advancing AI tools could upend traditional business models and revenue streams.

The S&P 500 software index has slumped as investors rotate out of high-flight tech names amid heightened volatility and skepticism over how quickly and profitably AI adoption will play out.

Pandl contends that blockchains are likely to become the financial rails for AI agents. Today’s chatbots operate largely outside the financial system. But if AI agents are equipped with digital wallets, he expects them to transact over blockchains rather than traditional bank infrastructure.

Blockchains offer transparency, near-instant settlement, 24/7 availability and global reach with an internet connection, he said. While opening a bank account requires a human intermediary, any user, including a bot, can create a blockchain address. Pandl said rising volumes of low-value stablecoin transactions would be an early signal that this thesis is playing out.

At the same time, he argued that blockchain technology could help mitigate some of AI’s risks. As large language models proliferate, concerns around data provenance, deepfakes and the concentration of control over resources and decision-making are likely to intensify. Public blockchains, Pandl said, can provide verifiable records and more decentralized infrastructure to counterbalance those trends.

The report acknowledged AI may also introduce new challenges for crypto networks. Advanced tools could make blockchain surveillance more effective, potentially eroding user privacy. AI agents may also uncover new vulnerabilities in smart contracts; OpenAI recently launched EVMbench, an initiative aimed at using AI to identify and patch such risks.

Read more: Crypto isn’t losing to AI, its just ‘capitalism doing its job,’ says Dragonfly

Crypto markets dipped slightly on Thursday, with the total market cap dropping by about 2% over the past day to around $2.39 trillion.

Bitcoin (BTC) is trading near $67,000, down 2% over the past day but up 1% for the week, slightly below Wednesday’s peak.

Ethereum (ETH) slipped to $1,992, posting a 3% daily loss. Among other Top 10 assets, Solana (SOL) dropped 3.5%, XRP plunged 5%, and BNB fell 1.5%.

‘Constructive Return of Liquidity’

Analysts at glassnode noted in an X post today that “profit-taking continues to absorb momentum at the $70K threshold,” implying that this is consistent with a thin liquidity regime where even modest realization events are sufficient to suppress recovery attempts.

“Historically, breaks below 1 have persisted for 6+ months before reclaiming it, a recovery that typically signals a constructive return of liquidity to the market,” they added.

Paul Howard, senior director at crypto trading firm Wincent, said in commentary for The Defiant that stronger-than-expected earnings overnight had lifted tech stocks and risk assets more broadly.

He noted that “the short squeeze on Circle was notable, alongside the significant short interest in MSTR and the earnings beat from NVDA,” adding that these moves contributed to Bitcoin’s rally over the past 24 hours.

Howard added that the market is still looking for a clear catalyst that could push cryptocurrencies significantly higher, rather than just supporting them as a hedge trade.

Big Movers and Liquidations

Among the Top 100 assets by market cap, Pippin (PIPPIN) led gains with an 18.4% jump, followed by Internet Computer (ICP), which is up 8.5%.

On the downside, Cosmos Hub (ATOM) fell 7.9%, and Morpho (MORPHO) declined 3.6%.

CoinGlass reports that more than 157,000 traders were liquidated over the past 24 hours for a total of $560 million.

Shorts dominated with around $420 million liquidated, compared with nearly $148 million in long positions.

ETFs and Macro Conditions

Spot Bitcoin ETFs saw inflows of $506 million on Wednesday, Feb. 25, the largest single-day inflow since Jan. 5, bringing total net assets to $87.6 billion. On that same day, spot Ethereum ETFs added $157 million, bringing cumulative net assets to $11.8 billion.

On the macro front, U.S. Treasury yields were mostly flat. The 10-year note slipped slightly to 4.042%, the 30-year bond yield edged down to 4.687%, and the 2-year note ticked higher to 3.473%.

Thursday’s Labor Department report showed initial unemployment claims for the week ended Feb. 21 at 212,000, slightly above the prior week’s revised 208,000 but below the 215,000 forecast, CNBC reported.

On the geopolitical side, Iran’s foreign ministry said today’s nuclear talks in Geneva produced “very constructive” proposals, but didn’t give any details, according to the Associated Press. The U.S. and Iran are negotiating indirectly, with Oman’s foreign minister and the UN’s nuclear watchdog also present.

The AI and data center boom partly driven by Bitcoin miners is increasingly being financed through high-yield bond issuance, underscoring how lenders are pricing both risk and opportunity in the sector.

According to TheEnergyMag’s latest newsletter, companies tied to AI data center development have raised about $33 billion in long-term senior notes over the past 12 months, excluding convertible debt — bonds that can later be converted into equity and typically carry different risk dynamics.

The interest rate spread is notable: While regulated utilities and traditional energy companies generally borrow at 4% to 5%, AI- and crypto-linked issuers pay closer to 7% to 9%.

The average coupon on newly issued US dollar high-yield debt has was close to 7.2% in late 2025, from 8% to 9% in 2023, according to Janus Henderson Investors, citing BofA Global Research, average coupon, as of Nov. 30.

Those at the higher end of the spectrum are largely current or former digital asset mining companies that have pivoted into AI infrastructure, suggesting capital remains comparatively expensive for the group. 

TheEnergyMag cited recent raises, including CoreWeave at 9.25% and 9% in May and July 2025, Applied Digital at 9.2% in November, TeraWulf at 7.75% and Cipher Mining at 7.125% and 6.125%.

“The message from lenders is clear,” TheEnergyMag wrote. “Regulated load and contracted generation still get treated as infrastructure. AI and bitcoin, even when attached to long-term offtake agreements, are still treated as growth credit.”

Related: Canaan buys 49% stake in three Texas mining sites for $40M

AI infrastructure boom intensifies 

Despite concerns about overspending and potential overcapacity, the AI data center build-out remains one of the most visible trends in the economy, and a major driver of demand on Wall Street.

The scale of that momentum was underscored on Wednesday when chipmaker Nvidia posted blockbuster fourth-quarter results, with profit rising 94% and revenue climbing 73% year-on- year. The chipmaker reported $43 billion in net income and $68.1 billion in revenue.

Meanwhile, Bitcoin mining companies are planning about 30 gigawatts of new power capacity aimed at AI workloads, nearly triple the capacity they currently operate. Much of it remains in development pipelines or early-stage planning, but the industry has made clear that AI infrastructure is a strategic priority.

Related: The real ‘supercycle’ isn’t crypto, it’s AI infrastructure: Analyst