Bitcoin reversed its previous gains on November 5 as technology shares linked to artificial intelligence dropped sharply and a wave of crypto long liquidations swept through the market. The cryptocurrency’s price fell nearly 5% in a single day, with CoinGecko recording a value of $75,994 at 18:13 UTC, representing a 5.7% decline over 24 hours.
Sharp moves follow AI stock selloff and liquidations
Major US equities also declined on November 5, as investors grew cautious about prospects for returns on AI infrastructure spending. The S&P 500 lost 3.5%, the Dow Jones Industrial Average dropped 1,433 points (2.7%), and the Nasdaq Composite fell by 4.7% within the same trading period, according to data from the Associated Press.
On the cryptocurrency side, Decrypt reported that roughly $428 million in long positions were liquidated within a single hour. Such large-scale liquidations occur when leveraged positions are automatically closed as prices fall, inflicting sudden losses on traders with overly optimistic bets.
Decrypt found that about $428 million in crypto long liquidations took place in one hour on November 5, coinciding with a pullback in both digital assets and tech-related equities.
The selloff was not limited to Bitcoin. Ether, the native token of the Ethereum blockchain, dropped to $2,254.01, marking a 7.34% decline over 24 hours, according to CoinGecko.
| Asset | Price at 18:13 UTC, Nov. 5 | 24-hour change |
|---|---|---|
| Bitcoin | $75,994 | -5.7% |
| Ether | $2,254.01 | -7.34% |
Market context: Election, AI, and liquidations
The downturn in Bitcoin and tech stocks followed the US midterm elections, where Democrats secured control of both chambers of Congress. This shift sparked renewed policy questions, with investors considering potential changes in technology and infrastructure spending.
Reuters quoted FHN Financial macro strategist Will Compernolle, who noted that investors were still digesting the election outcome and reassessing the outlook for AI investment. Compernolle highlighted a rotation away from chipmakers and an increased preference for Treasury bonds as risk sentiment shifted.
Will Compernolle indicated that the election results and doubts about AI-related returns contributed to volatility in both equities and cryptocurrencies, but did not assign a single factor as the sole driver.
Meanwhile, President Donald Trump acknowledged his party’s midterm losses and said he was open to working with Democrats on several issues, while emphasizing the possibility of vetoing certain legislative proposals if needed.
Data from Alternative.me showed the Crypto Fear & Greed Index standing at 50 (Neutral) on November 5, reflecting ambivalent market sentiment rather than clear directional signals. The index is widely followed for a snapshot of investor mood in the crypto sector.
Mini dictionary: Crypto Fear & Greed Index, a sentiment indicator that gauges crypto market psychology using factors like volatility, volume, and surveys, ranging from Extreme Fear to Extreme Greed.
No clear cause, but close correlation
Although Bitcoin’s decline coincided closely with a sharp pullback in AI-linked stocks and other risk assets, market observers have not identified a definitive cause for the crypto drop. The back-to-back surges in liquidation—first of short positions during the November 4 rally, then of long positions during November 5’s selloff—point to a turbulent trading environment as traders rapidly adjusted to shifting prices.
Reuters reported that the Nasdaq index had fallen over 10% from its October 6 record close, losing more than $2.5 trillion in market capitalization during October amid growing skepticism about the profitability of AI infrastructure investments. Losses in major technology names like Nvidia, AMD, and CoreWeave contributed to the broader pullback in equities.
What’s next for Bitcoin and markets?
For now, the data illustrates a significant selloff in both crypto and equity markets, without a clear answer as to whether stabilization or further declines lie ahead. The market continues to watch policy developments in Washington, investor sentiment regarding artificial intelligence, and liquidation activity in the crypto sector for signs of a new direction.
