Two asset classes that were punished, at times severely, on Monday were cryptocurrencies and tech stocks. In many ways cryptos and related assets were punished harder, with many investments plunging sharply in price on the day.

Although the degrees of pain varied, crypto mining stocks generally landed in negative territory across the trading session. Cleanspark (NASDAQ: CLSK) was a top candidate to reach the bottom, with a nearly 10% decline in its share price at market close. Cipher Mining (NASDAQ: CIFR) also ended the day in rough shape with a nearly 7% fall, while Marathon Digital Holdings (NASDAQ: MARA) escaped the worst of it with a loss of 1.4%.

Carrying a burden from across the sea

Since crypto miners are tied so tightly to the performance of the assets they mine, if coins and tokens are under fire, you can bet they'll catch some of that burn too. Investors were actively selling out of all manner of cryptos on Monday, with eternal bellwether Bitcoin down by more than 7% in early evening trading.

As with tech stocks and, in many ways, the broader equity market, one immediate catalyst for the sell-off was the Bank of Japan's hike in its key interest rate last Wednesday. Since these were wafer-thin, even an incremental raise -- in this case to roughly 0.25% from a range of 0% to 0.1% -- was sure to have an impact on the yen. Unhappily for the crypto market, the yen carry trade (explainer here) led to a sharp pullback in said market.

Compounding that is a long-tail pullback in cryptos. This was an asset class that many investors were chomping at the bit to get into near the start of the year when the new spot Bitcoin exchange-traded funds (ETFs) sparked excitement over the No. 1 coin. That momentum helped carry the crypto market higher for several months. But the damp squib that was the Bitcoin halving in April sapped enthusiasm, which has yet to fully recover.

Good news to come?

These days, Bitcoin trades at just under $55,000 apiece. That's quite some distance down from the more than $70,000 level it was bouncing around at near the halving.

Which is why it, and associated assets like crypto miners, might be set for a rebound before long. The yen carry trade effect should fade fast as yen carriers adjust their positions in coins and tokens, meanwhile it's starting to look increasingly likely that the Federal Reserve will cut its key interest rate, and soon.

Rate cuts are a balm to crypto investors, as they boost the market's appetite for assets considered to be risky -- like cryptos and the companies that mine them.

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Eric Volkman has positions in Bitcoin. The Motley Fool has positions in and recommends Bitcoin. The Motley Fool has a disclosure policy.

Why Crypto Mining Stocks Tumbled Today was originally published by The Motley Fool