Wall Street Is Selling First and Thinking Later
A small research firm called Citrini published a thought exercise on Substack over the weekend. It imagined a dystopian 2028 where AI displaces white-collar workers at scale, guts consumer spending, and sends the S&P 500 down 38%.
It was explicitly framed as a scenario, not a prediction.
The market didn't care. The Dow dropped 800 points on Monday. Enterprise software stocks got hammered, extending what's now a nearly 30% decline year-to-date in the iShares Software ETF. IBM had its worst single-day drop in over 25 years, down 13%, after Anthropic announced that Claude Code can automate COBOL modernization. Cybersecurity stocks like CrowdStrike, Cloudflare, and Datadog got crushed the Friday before when Anthropic unveiled a new security vulnerability scanner.
A single blog post and a couple product announcements wiped hundreds of billions in market cap across some of the largest companies in the world.
That should tell you everything about the current psychology of this market.
Here's my take: most of this is hysteria.
The founder of Citrini Research was working as a paramedic in Los Angeles before launching the firm in 2023. The research may well be thoughtful, it clearly struck a nerve, but that's kind of the point. The fact that a single Substack post can move hundreds of billions of dollars in market cap tells you everything you need to know about how fragile sentiment is right now.
Investors are selling first and thinking later. That's what fear does.
Nobody knows what AI's impact on the economy will look like at a broad, macro scale. It is genuinely impossible to model with any useful precision right now. And yet, humans are predictable, we weigh negative outcomes more heavily than positive ones. It's called negativity bias, and it is alive and well on Wall Street this month.
When things are uncertain and "in the air," we default to fear. We overweight the risks and underweight the opportunities. I think the selling in software is overdone, and I'm fading it.
What I find interesting is that while software stocks are being treated as casualties of the AI revolution, one corner of the market is quietly being rewarded for embracing it: Bitcoin miners that pivoted to AI infrastructure.
These companies, the ones that took their massive high-power computing setups and repurposed them for AI workloads, are outperforming even as Bitcoin itself sits well below its highs.
The CoinShares Bitcoin Mining fund $WGMI tracks this space closely.
Public miners are now planning to nearly triple their AI-focused power capacity to 30 gigawatts. Hyperscalers need power, and these guys already have it.
This is the same theme I've been writing about for a long time. The best crypto stocks aren't the ones tethered to Bitcoin's price. They're the ones becoming indispensable to the AI buildout.
And while the rest of the market panics over a fictional 2028 crisis, these names are setting up again, quietly, with real contracts and real revenue behind them.
Fear is everywhere
I'm fading it.
Cheers,
Louis Sykes
Senior Crypto Analyst, All Star Charts
