IREN Ltd (NASDAQ:IREN), a crypto-linked company, saw its stock price plummet by 5.39% over a 24-hour period, as the company faced multiple headwinds in the cryptocurrency market and criticism from a prominent short-seller. The significant drop comes amid a broader decline in cryptocurrency prices and fresh concerns about the company's future prospects.

The primary driver behind IREN's stock decline appears to be the recent downturn in the cryptocurrency market. Bitcoin, the leading digital currency, has fallen by 2.36% over the past 24 hours, trading around $108,500. This represents a substantial pullback from its recent record high of over $126,000 reached earlier this month. The crypto market's weakness has been attributed to escalating U.S.-China trade tensions, with both nations implementing new port fees on shipping companies this week. As IREN uses its Bitcoin gains to fund its AI infrastructure pivot, the crypto market downturn has directly impacted its stock performance.

Adding to IREN's woes, renowned short-seller Jim Chanos publicly challenged the company's bullish outlook on Tuesday. Chanos took issue with a recent Cantor Fitzgerald research report, arguing that it relied on implausible assumptions. He specifically questioned the forecast of 80% EBITDA margins for IREN's AI data center operations, noting that current industry leaders are barely achieving 50%. Chanos also raised concerns about the depreciation assumptions for IREN's planned $2.9 billion equipment purchases, suggesting the analysis implies an unrealistic nine-year lifespan for rapidly obsolescing GPU hardware. This criticism has likely contributed to investor uncertainty and the subsequent sell-off in IREN's stock.