Bitcoin Falls 6% to $75,700 as Stock Sell-Off Spills Into Crypto

Key Facts

Bitcoin fell 6% to $75,700 during Thursday’s session on November 5, while Ether dropped more than 7% to $2,247, according to a report by The Block. The decline in cryptocurrencies came amid a broad sell-off in U.S. stocks, in a session when technology losses weighed on higher-risk assets. The market erased its post-election gains, though the report did not give a confirmed figure for their value. The retreat coincided with growing concern that macroeconomic pressures would persist. U.S. index moves showed the sell-off extended beyond the cryptocurrency sector.

By 2 p.m. Eastern time, the Nasdaq Composite was down 4.7%, while the Dow Jones and S&P 500 had each fallen about 3%, according to The Block. The technology-heavy index’s weaker performance reflected higher-risk assets’ sensitivity to market pressures. In cryptocurrencies, Bitcoin hit an intraday low of $75,568 before being reported at $75,700. Ether fell more than 7% to $2,247. The move followed a rebound in cryptocurrencies on November 4, when Bitcoin briefly rose to $78,354 and Ether climbed to $2,323, according to Reuters via MarketScreener.

The decline was accompanied by an increase in positions being forcibly closed as prices fell. Derivatives liquidations totaled about $1.1 billion over 24 hours through November 5, affecting about 211,000 traders, according to The Block. The figures show the sell-off’s broad impact among traders, with added pressure on leveraged positions. In the lead-up to the decline, the cryptocurrency market had lost about $300 billion in value over the previous month, according to a Reuters report published on November 4. The report linked this to investors’ concerns about future returns on artificial intelligence and higher borrowing costs, fears that pushed them toward lower-risk assets such as government bonds and currencies considered safe havens.

The previous rally had been driven by a combination of factors, according to Wintermute, as cited by The Block: relief after the Binance breach, optimism over election results, expectations of slower AI spending and lower oil prices. But the company said those drivers were not enough to offset persistent macroeconomic pressures. An OTC trader at Wintermute said, "Trump will remain president for two years, the Middle East is still seeing escalation, and inflation is high in a strong U.S. economy." On November 4, the election results had revived concerns about the sector’s ability to accelerate easing of digital-asset regulation after Democrats won control of both chambers of Congress, according to Reuters. The agency’s report also said investors withdrew $215 million from the largest Bitcoin exchange-traded funds in October, taking year-to-date outflows to $1.84 billion.

U.S. inflation data add to the factors investors are tracking as they assess the interest-rate path. The consumer price index rose 0.6% in September, after a 0.4% increase in August, and was up 3.7% over the 12 months through September, according to the U.S. Bureau of Labor Statistics. The October consumer price index is scheduled for release on November 10 at 8:30 a.m., according to the bureau’s calendar. Interest-rate traders had pushed back their forecast for the next U.S. rate increase to March, according to Reuters in its report on the November 5 session. That puts the upcoming release among the data investors are watching to assess inflation and monetary-policy expectations.

On price levels, Wintermute identified $73,000 and then $68,000 as points to watch if Bitcoin weakness continues, according to The Block. The company said it would need to see the cryptocurrency reclaim $80,000 and hold above it before becoming more optimistic. Upcoming U.S. dates include publication of the minutes from the Federal Open Market Committee’s October meeting on November 18, followed by the committee’s meeting on December 8 and 9, according to the Federal Reserve calendar. The central bank’s calendar did not list an expected speech by Kevin Warsh in the days following the date of the report. These levels and dates remain points for the market to monitor in the wake of the sell-off.