The rebound after the election only lasted one day, and the crypto market faced another sell-off. The Nasdaq fell 5.5% in a single day, the semiconductor index plummeted 12%, and BTC quickly fell from around $81,000 to a low of about $76,000.

On November 5, tech stocks in the US faced severe sell-offs, with the Nasdaq composite index closing down 5.5%, at 24,315 points; the S&P 500 index decreased by 4.4%, and the Dow Jones index dropped by 3.4%. Among these, the Philadelphia Semiconductor Index fell about 12% in one day, NVIDIA dropped about 9%, and AMD fell about 17%, with the chip sector becoming the hardest hit in this round of sell-off.

This decline is not merely an adjustment of individual stocks. After the results of the US midterm elections were announced, the market began to reassess the prospects for AI data center construction. Some investors are concerned that the Democratic party's victories in several elections may lead to more regulation of data center construction, affecting the pace of AI infrastructure investments. Meanwhile, growing skepticism about the return on massive AI capital expenditures also contributed to the release of the high valuation pressure that tech stocks had accumulated earlier.

BTC follows tech stocks down, quickly giving back post-election gains

The sell-off of risk assets quickly transmitted to the crypto market.

After the election results were announced on November 4, BTC rebounded to about $81,105, but as US tech stocks turned downward, the price quickly fell back. On November 5, BTC dropped below $77,000, briefly touching around $76,059, which was more than a 6% pullback from the previous day's peak, returning to a low range not seen since September.

Michael Saylor, founder of Strategy, publicly compared the declines in the stock market and Bitcoin that day. He pointed out that the S&P 500 index fell by 4.4%, the Nasdaq fell by 5.5%, while BTC fell by about 5%. This comparison reflects that when the market focuses on reducing risk exposure, Bitcoin is also affected by the sell-off of traditional risk assets.

Leverage liquidations in the derivatives market further amplified the volatility. According to CoinDesk data, over the past 24 hours, liquidation in the crypto market exceeded $1 billion, with both BTC and ETH showing significant pullbacks. The long positions accumulated after the election results were announced faced concentrated liquidation pressure as prices rapidly declined.

Weak ETF demand, aftermath of Binance incident still lingers

In addition to the impact of the US stock market, the funding environment within the crypto market is also not optimistic.

The US spot BTC ETF has seen consecutive capital outflows. On October 30, related products had a net outflow of about $643 million in a single day, marking the largest single-day outflow since June; on November 2 and 3, there were additional outflows of about $399 million and $116 million, respectively. Although about $74.6 million of net inflow was recorded again on November 4, the overall capital performance remains rather volatile.

The confidence pressure from the Binance hacker incident has not completely dissipated. After the exchange resumed withdrawals, customers concentrated their withdrawals, resulting in a cumulative net outflow reaching about $5.28 billion at one point. Although Binance subsequently stated that the outflow rate had slowed, and deposits had begun to exceed withdrawals in certain periods, concerns regarding the security of trading platforms, asset custody, and liquidity remain.

It is important to differentiate that customer withdrawals from Binance do not equate to all funds exiting the crypto market, nor can it be directly interpreted as selling volume for BTC. However, against the backdrop of unstable ETF demand and declining macro risk appetite, such capital flows will further affect market sentiment.

What signals to watch next?

The current market pressure comes from three aspects: the valuation adjustment of US tech stocks, the fluctuating demand for spot ETFs, and the confidence recovery after the exchange security incidents.

In the short term, attention needs to be paid to whether BTC can hold the $75,000 to $76,000 area, and whether the Nasdaq and semiconductor sectors continue to decline. If the sell-off in US tech stocks further expands, the crypto market may continue to be dragged down by a declining risk appetite; conversely, if US stocks stabilize and ETF capital turns to consistent net inflows again, BTC will have a better chance to stabilize the current price range.

The key point of this round of correction is not just BTC falling below $77,000, but that the risks from US tech stocks are being re-transmitted to the crypto market. The post-election rebound has already been quickly given back, and the market now needs to seek new support.

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The content of this article only represents the author's personal opinion and does not represent the stance of this platform. The opinions, conclusions, and suggestions in the text are for investor reference only and do not constitute any investment advice related to this platform. The market has risks, and investments need to be cautious.

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