Bitcoin’s post-election recovery has lost momentum as a broader technology stock selloff weighs on cryptocurrency markets.
The latest downturn has renewed questions about institutional demand and the resilience of Bitcoin exchange-traded funds (ETFs).
Meanwhile, heavy liquidations have added pressure as investors reassess their exposure to risk assets. The coming ETF flow reports could reveal whether institutional buyers remain committed or have resumed withdrawing capital.
Bitcoin drops 6% as AI stock selloff spreads
Bitcoin fell sharply on Thursday after briefly reaching $80,000 on Wednesday. The cryptocurrency dropped to $75,700, losing approximately 6% within 24 hours. Ether also declined more than 7% to $2,247, according to The Block.
The declines followed a broader selloff in artificial intelligence stocks across Wall Street. Investors continued questioning whether substantial AI investments would generate sufficient returns.
The downturn also triggered significant liquidations across cryptocurrency markets. Data from CoinGlass, cited by The Block, showed that traders lost $1.1 billion through liquidations within 24 hours. Approximately 211,000 positions faced forced closures during that period.
One four-hour trading window accounted for $879.92 million in liquidations. Long positions represented $818.90 million of those losses, highlighting the pressure on bullish traders.
However, liquidation figures do not represent withdrawals from Bitcoin ETFs. They measure leveraged positions that exchanges forcibly closed after traders failed to maintain sufficient margin. ETF flow data instead tracks money entering or leaving investment funds.
Bitcoin ETF outflows raise questions about institutional demand
Bitcoin ETFs experienced substantial withdrawals before Thursday’s market decline. According to FarSide data, the funds recorded $643.2 million in net outflows on October 30. Withdrawals continued with $398.6 million on November 2 and another $115.6 million on November 3.
Combined, the three sessions produced approximately $1.16 billion in outflows.
However, November 4 brought a reversal as spot Bitcoin ETFs recorded $74.6 million in net inflows. The aggregate figure concealed significant differences between the leading funds.
Fidelity’s FBTC attracted $236.7 million, while BlackRock’s IBIT recorded $201.2 million in outflows. Meanwhile, November 5 figures remained incomplete, with several providers yet to report their results.
The latest withdrawals followed another major selling session in October, when Bitcoin ETFs recorded $487 million in single-day outflows.
Consequently, the November 4 recovery has not established a sustained improvement in institutional demand. Additional ETF reports will help determine whether investors have resumed buying or whether withdrawals remain the dominant trend.
Nasdaq losses deepen Bitcoin pressure as analysts identify key levels
The technology stock selloff added another source of uncertainty for cryptocurrency investors. The Nasdaq closed Thursday down 5.5% at 24,315, marking an 11.9% decline from its October peak. The S&P 500 dropped 4.4%, while Nvidia shares lost 9.3%.
Investors have increasingly questioned the returns from expensive AI projects. High borrowing costs and potential post-election restrictions on data centers have also increased uncertainty.
Swissquote analyst Ipek Ozkardaskaya told Reuters that investors entered the earnings season concerned about excessive AI spending.
J.P. Morgan’s Michael Cembalest reported an 8% decline in hedge funds’ gross long-short exposure. He also identified approximately $4 trillion in AI-related off-balance-sheet commitments. These commitments do not represent immediately payable debt.
Cembalest further warned that 37.5 gigawatts of planned 2028 data-center capacity could face construction pauses. Another 15 gigawatts could encounter additional conditions, although neither scenario confirms project cancellations.
Bitcoin’s relationship with technology stocks provides additional context for the latest decline. Foundry Labs measured a 0.41 correlation between Bitcoin and the Nasdaq-100 tracker QQQ over 63 days. The research also found that publicly traded Bitcoin miners increasingly behave like AI infrastructure stocks.
S&P Global similarly observed Bitcoin moving alongside equities during periods of reduced risk appetite. Its 2025 study found that election-related volatility affected cryptocurrencies, stocks, and oil. However, these findings do not establish that the AI selloff directly caused Bitcoin’s decline.
Meanwhile, Wintermute described Wednesday’s recovery as short-lived optimism. The firm identified $73,000 and $68,000 as important levels to watch. It also said Bitcoin needs to remain above $80,000 before adopting a more positive outlook.
Political uncertainty could create additional pressure. Wincent’s Paul Howard said Democrats’ recent congressional gains could complicate efforts to pass the Clarity Act. Upcoming ETF reports will therefore remain important in determining whether institutional demand can support Bitcoin’s recovery.
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