Cryptocurrency markets extended their decline on Sunday as fears over artificial intelligence disruption rippled through the technology sector, with IBM shares plunging 11% after Anthropic announced that its Claude platform can streamline COBOL code — a legacy programming language that has long been a key profit center for the tech giant.
—
The selloff underscored growing anxiety about how rapidly advancing AI tools could upend established business models, with contagion spreading from equities into digital assets.
The downturn marks the latest instance of crypto markets moving in tandem with traditional tech stocks, a correlation that has strengthened significantly over recent years as institutional participation in digital assets has grown. According to CoinDesk's reporting, the broader crypto market suffered deeper losses as the AI-driven selloff in equities weighed on risk sentiment across asset classes.
Loading tweet...
View Tweet
What Triggered the Selloff
The catalyst was Anthropic's announcement that Claude, its flagship AI platform, can now efficiently streamline COBOL code. COBOL — Common Business-Oriented Language — is a decades-old programming language that still underpins critical systems across banking, insurance, government, and enterprise infrastructure worldwide.
Despite its age, COBOL remains deeply embedded in legacy systems, and the specialized expertise required to maintain and modernize it has been a lucrative revenue stream for companies like IBM.
IBM has built a significant portion of its enterprise services business around maintaining and updating COBOL-based systems for large institutions. The prospect of an AI tool automating much of that work struck directly at one of the company's core profit centers, sending shares down 11% and dragging broader tech sentiment with it.
The reaction reflects a deeper market anxiety: if AI can rapidly commoditize specialized, high-margin services in legacy technology, which other established revenue streams might be next?
That question reverberated beyond IBM, contributing to a broader risk-off move across technology and technology-adjacent assets — including cryptocurrencies.
Crypto's Deepening Correlation With Tech
The crypto market's response to an AI-driven tech stock selloff highlights the increasingly tight relationship between digital assets and traditional risk markets. Bitcoin and major altcoins have increasingly traded in step with the Nasdaq and tech-heavy indices, particularly since the wave of spot Bitcoin and Ethereum ETF approvals brought more traditional capital into the space.
This correlation has been a double-edged sword. When tech rallies, crypto tends to benefit from the same risk-on sentiment. But when fears about AI disruption, interest rates, or macroeconomic uncertainty hit equities, digital assets are no longer insulated. The idea of Bitcoin as an uncorrelated "digital gold" has been tested repeatedly, and episodes like this weekend's selloff continue to challenge that narrative.
Market participants have noted that crypto-specific catalysts were largely absent from the weekend's price action. Instead, the decline appeared driven almost entirely by spillover from the equity market rout, suggesting that macro and cross-asset dynamics remain the dominant force for crypto in the current environment.
The Broader AI Disruption Narrative
Anthropic's COBOL announcement is part of a larger trend that has rattled investors across sectors. Over the past year, rapid advances in large language models and AI coding assistants have raised questions about the future of software services, consulting, and IT maintenance — industries that collectively generate hundreds of billions of dollars in annual revenue.
For the crypto industry specifically, the AI disruption narrative cuts both ways. On one hand, AI-related tokens and projects have attracted significant capital and attention, with the intersection of AI and blockchain emerging as one of the most active areas of development. On the other hand, broad AI-driven uncertainty in tech valuations can suppress the risk appetite that fuels speculative crypto investment.
The IBM selloff is a reminder that AI advancement doesn't just create winners — it also creates losers, and markets are increasingly pricing in that disruption risk across the board.
COBOL modernization alone represents a multi-billion-dollar market. Estimates have placed the total lines of COBOL code still in active production at over 800 billion globally, running everything from ATM networks to federal tax systems. If AI tools can meaningfully automate the translation and maintenance of that codebase, the implications extend far beyond IBM to an entire ecosystem of IT services firms.
Loading tweet...
View Tweet
What to Watch Next
Several factors will determine whether this selloff deepens or stabilizes in the coming days:
Equity market follow-through: Monday's trading session will be critical. If the IBM-led tech selloff accelerates, crypto markets are likely to face continued pressure.
AI sector earnings and guidance: Upcoming earnings reports from major tech companies will be scrutinized for signs of AI-driven margin compression or business model disruption.
Crypto-specific catalysts: Any positive developments in crypto regulation, ETF flows, or onchain activity could help decouple digital assets from the broader tech narrative.
Risk sentiment indicators: The VIX, credit spreads, and Treasury yields will offer clues about whether the current risk-off mood is a short-lived reaction or the beginning of a more sustained repricing.
For now, the crypto market remains caught in the crossfire of a tech sector grappling with the disruptive potential of AI. The weekend's decline serves as a stark reminder that in 2026's interconnected financial markets, a breakthrough in AI code generation can move Bitcoin just as quickly as it moves IBM.
