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Bitcoin’s 2025 rollercoaster ride may end on a low

Data centres – a view from the inside WASHINGTON: The expansion of data centres to power the AI boom has more people wondering: what exactly is in a data centre? AFP got a chance to take a look at what is inside. Concrete warehouse Data centres are the physical infrastructure that make our digital lives possible, yet most people have never seen one up close or understand how they operate. Roughly 12,000 data centres are in operation in the world, with about half in the US, according to Cloudscene, a data centre directory. At its most basic, a data centre is a concrete warehouse filled with thousands of computer servers working in tandem. Traditional facilities span one or two floors divided into vast rooms, though newer ones rise higher. A facility may serve a single company or be shared by several clients. The servers sit in standardised 19-inch (48 cm) racks – essentially metal closets lined up in rows. A large data centre can house tens of thousands of servers running simultaneously, generating enormous heat and consuming significant energy for both power and cooling. High-speed networking equipment – switches, routers, and fiber optic cables – connects everything, moving terabytes of data per second. Stay close Having a data centre close to end users improves speed, which is critical for things like trading and gaming where immediacy is paramount. Ashburn, Virginia, which has the highest concentration of data centres in the world, offers ideal conditions as it is located only about 30 miles from the US capital, Washington. However, building in densely populated areas costs more and faces local resistance. Companies increasingly turn to rural locations where land is cheaper and zoning less restrictive. But distance adds to loading times – that brief delay when a page loads or a feed refreshes. Stay cool Inside these bunker-like buildings, a single server rack generates as much heat as several household ovens running nonstop. Cooling consumes roughly 40% of a data centre’s total energy. The most advanced chips – GPUs (graphics processing units) used for AI – can reach temperatures exceeding 90°C, threatening performance and causing permanent damage during extended operation. They are also much heavier than lower performing chips. Traditional facilities use computer room air conditioners with heat blasting out of mounted vents on rooftops – but this is not fit for GPUs that mainly turn to water for cooling. Modern facilities are beginning to deploy “free cooling” that uses outside air when temperatures allow, and different water-based approaches: liquid cooling systems that pump coolant directly to components or evaporative cooling that works like perspiration on skin. Where’s the power? Power supply – and the high voltage transmission lines needed to source it – is key for a data centre and is only growing with facilities that run the powerful GPUs. “One of the biggest challenges for a lot of our customers is they buy the chips and then they don’t know where to go,“ Chris Sharp, chief technology officer at Digital Realty, which operates data centres around the world, told AFP. The big tech giants, caught up in the AI arms race, have spent tens of billions of dollars in just months towards building suitable structures for GPUs. Operators rely on the existing power grid but are increasingly seeking to secure their own resources – called “behind-the-meter” – for greater security and to limit rate increases for all users.

The decision appears to settle a US debate about whether Nvidia and rivals should maintain their global lead in AI chips by selling to China or withhold the exports, though Beijing has told companies not to use US technology, leaving it unclear whether Trump’s decision would lead to new sales. Nvidia shares rose 2% in after-hours trading after Trump made the announcement on Truth Social, following a 3% rise during the day on a report by Semafor. Trump said in his post that he had informed President Xi Jinping of China, where Nvidia’s chips are under government scrutiny, about the move and that he “responded positively.” He said the US Commerce Department was finalising details of the arrangement and the same approach would apply to other AI chip firms such as Advanced Micro Devices and Intel. Trump’s post said the fee to be paid to the US NEW YORK: With a series of record highs and crushing sell-offs, 2025 has been a rollercoaster ride for bitcoin, the world’s largest cryptocurrency, which is at risk of ending the year with its first annual decline since 2022. The world’s main stock benchmarks have also had a turbulent year, repeatedly hitting record peaks and then pulling back as worries over tariffs, interest rates and a possible AI bubble whipsawed markets. While equities are mostly up year-to-date, bitcoin’s overall correlation with share prices has strengthened markedly this year. Analysts say bitcoin’s gyrations increasingly tracked stock market sentiment as traditional retail and institutional investors jumped into cryptocurrencies, which next year may be even more closely tethered to factors driving stocks and other risk assets, such as monetary policy shifts and nervousness over the lofty valuations of AI-related stocks. “Crypto reacting to broader equities has been a consistent theme in 2025,” said Jasper De Maere, desk strategist at crypto algorithmic trading firm Wintermute. Bitcoin was hovering around US$89,000 (RM365,851) on Monday. After soaring earlier this year with the election of crypto-friendly US President Donald Trump, cryptocurrencies – along with stocks – plummeted in April on his tariff announcements, but quickly rebounded. Bitcoin went on to hit an all-time peak above US$126,000 in early October. But just days later, on Oct 10, the market plunged again when Trump announced a new tariff on Chinese imports and threatened export controls on critical software. That sparked more than US$19 billion worth of liquidations across leveraged crypto market positions, the largest liquidation in crypto history. Bitcoin o Crypto faces headwinds from stock-market alignment, AI jitters and fluctuating Fed outlook

Despite forecasts of US$150-200k, bitcoin’s steep drop and growing connection to stock markets have dampened bullish expectations. – UNSPLASH PIX

A White House official said that the 25% fee would be collected as an import tax from Taiwan, where the chips are made, to the US, where the chips will undergo a security review by US officials before being exported to China. China hawks in Washington are concerned that selling more advanced AI chips to China could help Beijing supercharge its military, fears that had first prompted limits on such exports by the Biden administration. The Trump administration had been considering greenlighting the sale, sources told Reuters last month. Trump said last week he met with Nvidia CEO Jensen Huang and that the executive was aware of where he stood on export controls. “It’s a terrible mistake to trade off national security for advantages in trade,“ said Eric Hirschhorn, who was a senior Commerce Department official during the Obama administration. – Reuters similar attributes and have been hit by worries that valuations are in bubble territory. Historically, bitcoin and stocks did not move in tandem because crypto was seen as an alternative investment. But with broader crypto adoption by traditional retail investors and some institutions, the correlation looks to be strengthening, analysts said. Correlation is measured from -1 to 1, with figures above zero indicating a positive correlation. In 2025, the average correlation between bitcoin and the S&P 500 – which tracks a broad basket of companies – was 0.5, compared with an average correlation in 2024 of 0.29, LSEG data shows. For the tech-heavy Nasdaq 100 index, the average correlation this year was 0.52, compared with 0.23 in 2024, according to LSEG data. Crypto has grown especially sensitive to AI stock moves partly because they have been drivers of broader equity markets, and partly because, like crypto, they are currently seen as somewhat speculative investments, largely dependent on investor sentiment and risk appetite, analysts said. “Crypto (was) already a little weak after Oct 10,” said Cosmo Jiang, a general partner at Pantera Capital, a crypto investor. “Things really started to break in risk markets in the recent weeks, because of the AI bull case coming under question.” – Reuters

“We will protect national security, create American Jobs, and keep America’s lead in AI,“ Trump wrote on Truth Social. “Nvidia‘s US Customers are already moving forward with their incredible, highly advanced Blackwell chips, and soon, Rubin.” Trump did not say how many H200 chips would be authorised for shipment or what conditions might apply, only that exports would occur“under conditions that allow for continued strong national security.” Administration officials consider the move a compromise between sending Nvidia’s latest Blackwell chips to China, which Trump has declined to allow, and sending China no US chips at all, which officials believe would bolster Huawei’s efforts to sell AI chips in China, a person familiar with the matter said. “Offering H200 to approved commercial customers, vetted by the Department of Commerce, strikes a thoughtful balance that is great for America,“ Nvidia said in a statement. has struggled to regain its footing ever since and in November experienced its biggest monthly drop since mid-2021, although options market bearishness has ebbed a little in recent weeks, according to options platform Derive.xyz. Traders as of late last week had assigned a 15% probability that bitcoin will finish the year below US$80,000, compared with the 20% probability they had assigned just a few weeks ago. That’s still a blow for crypto bulls, including Michael Saylor’s Strategy, the world’s biggest bitcoin hoarding company, which had projected as recently as Oct 30 that the token would hit US$150,000 this year. Analysts at Standard Chartered last year forecast bitcoin would hit US$200,000 by the end of 2025, due in part to flows into bitcoin exchange-traded funds. In a change of tune, Strategy CEO Phong Le warned on a podcast last month of a possible “bitcoin winter.” In October, Standard Chartered forecast bitcoin would fall below US$100,000 but said that may be the last time it will hit that low, according to media reports. Saylor, speaking to Reuters last week, said his company could survive a 95% fall in the price of bitcoin. Those April and October plunges highlighted the growing correlation between bitcoin and equities, and in particular, artificial intelligence stocks, which share

US to allow Nvidia H200 chip shipments to China WASHINGTON: The US will allow Nvidia’s H200 processors, its second-best artificial intelligence chips, to be exported to China and collect a 25% fee on such sales, US President Donald Trump said on Monday. government was “$25%”, and a White House official confirmed he meant 25%, higher than the 15% proposed in August. Intel declined to comment. The US Commerce Department, which oversees export controls, and AMD did not respond to requests for comment.