The Crash

More than $1 trillion has been wiped off the crypto market in the past six weeks. The market has fallen by a quarter since early October, according to CoinGecko.

Bitcoin has dropped 27% over the same period to $91,212. That's its lowest level since April.

The crypto crash comes amid fears of a tech bubble. Expectations for a US rate cut next month are also fading.

The Broader Selloff

Global markets are on edge. Europe's Stoxx 600 fell 1.8% Tuesday. The Dow Jones, Nasdaq, and S&P 500 were all down about 1%.

Asia saw steeper falls. Japan's Nikkei 225 dropped 3.2%. Hong Kong's Hang Seng fell 1.7%.

The AI Bubble Warning

Sundar Pichai, head of Google parent Alphabet, said there's "irrationality" in the current AI boom. He warned that if the bubble bursts, "no company is going to be immune, including us."

JP Morgan's Daniel Pinto said booming AI valuations are due for a correction. "That correction will also create a correction in the rest of the segment, the S&P and in the industry," he said.

Klarna CEO Sebastian Siemiatkowski said huge investments in computing infrastructure make him "nervous." He's also concerned about rising AI valuations.

The Pension Risk

Nvidia became the first company to hit $4 trillion in market value this year. Apple and Microsoft followed.

"You can say, 'I disagree with the fact that Nvidia is worth that much,'" Siemiatkowski said. "But the truth is, because of the index funds and how this works, your pension right now is going into that theory that it is a good investment."

A Bank of America survey found 45% of fund managers believe an AI bubble is the biggest risk in the stock market.

Gold Falls Too

The price of gold is also falling. It dropped 0.3% to $4,033.29 an ounce Tuesday morning. That's its lowest level in a week.

Higher interest rates make gold less appealing since the metal doesn't pay a yield.

The Bottom Line

The crypto market has lost $1 trillion in six weeks as AI bubble fears spread across tech stocks, with Bitcoin hitting its lowest level since April while executives from Google, JP Morgan, and Klarna warn that huge AI valuations and infrastructure spending look unsustainable.