Citrini analyst Jukan said on X that markets may be forced into a "short memory, long optical" trade in the near term, with some hedge funds already positioning accordingly. Three factors underpin the view: first, the near-collapse of Korea's leveraged ETF market is putting redemption pressure on investors, potentially adding sell-side outflows that weigh on Korean memory stocks. Second, Nvidia is adjusting its next-generation AI architecture, possibly cutting per-cabinet HBM allocations for Rubin Ultra while linking multiple cabinets via optical interconnect, keeping cluster-level performance competitive and making optical communications a likely beneficiary of AI infrastructure spending even if HBM cuts stem from supply constraints rather than softening demand. Third, consensus is building that memory prices may peak within the next two quarters. Despite the cautious near-term stance, Jukan remains bullish on the storage industry over the long run, noting that AI infrastructure investment is shifting focus from raw HBM capacity toward overall data center architecture efficiency, including high-speed optical interconnect. This could rotate capital away from memory chips into optical communications in the short term.
Citrini analyst Jukan said on X that the market may have little choice but to run a "short memory, long optical" trade in the near term, and some hedge funds have already started positioning for that shift.
Three factors drive the view, Jukan said. For one, after South Korea's leveraged ETF market largely stopped functioning, investors are facing redemption pressure, which could produce additional sell-side outflows. The ongoing adjustment in leveraged product capital chains may keep weighing on Korean memory chipmakers.
Separately, Nvidia is reworking its next-generation AI system architecture. The company may lower per-cabinet HBM allocations for Rubin Ultra and instead connect multiple cabinets through optical interconnect, preserving Rubin Ultra's cluster-level performance leadership. Even if the HBM reduction stems from supply constraints rather than falling demand, optical communications still look like a major beneficiary within AI infrastructure.
Third, the market is building a consensus that memory prices could peak within the next two quarters.
Over a longer time frame, Jukan still sees the storage industry positively, though he is cautious in the short term. AI infrastructure investment, he argued, is shifting from a narrow focus on HBM capacity toward broader data center architecture efficiency, including high-speed optical interconnect. That shift may push capital away from memory chips and into optical communication names in the near term.
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