Crypto Market Falls 5% as US Tech Selloff Triggers $1.07B in Liquidations

The cryptocurrency market came under heavy selling pressure on November 5 as a sharp decline in US technology stocks triggered a broader retreat from risk assets. Bitcoin fell below $76,000, while total crypto market capitalization dropped nearly 5% to $2.65 trillion.

The selloff followed a dramatic reversal on Wall Street. After initially rallying on the Democratic Party's midterm election victory, US stocks turned lower as investors reassessed the potential impact of tighter regulations on artificial intelligence (AI) development and data-center infrastructure.

The decline also hit leveraged crypto traders. CoinGlass data showed approximately $1.07 billion in cryptocurrency positions liquidated over 24 hours, affecting more than 200,000 traders. Long positions accounted for the majority of the losses.

Bitcoin Falls Below $76,000 as Crypto Market Cap Shrinks

Bitcoin dropped more than 5% on November 5, briefly reaching approximately $75,525. It had traded above $80,000 earlier in the session, meaning the decline erased much of its post-election recovery.

Bitcoin was trading near $75,908 at 16:00 GMT. Its weekly decline had reached approximately 7%.

The broader market followed the same direction. Total cryptocurrency market capitalization fell 5% to approximately $2.65 trillion, while Ethereum declined nearly 7% to around $2,250.

Liquidations added to the selling pressure. CoinGlass data cited by market reports showed approximately $1.07 billion in positions liquidated over 24 hours. Long traders accounted for roughly $941.16 million, indicating that bullish positions took most of the damage as prices moved lower.

Despite the decline, US spot Bitcoin ETFs recorded approximately $148.1 million in net inflows on November 5, according to the reported market data. This suggests that the price decline was not accompanied by outflows across every institutional investment channel.

US Tech Stocks Lead the Market Selloff

The pressure on crypto followed a sharp reversal across US equities.

Democrats won control of both the House of Representatives and the Senate in the November 4 midterm elections. Wall Street initially responded positively, with the S&P 500 gaining 1.6% that day. However, the mood changed on November 5 as investors assessed the possibility of tighter oversight of AI infrastructure and data-center expansion.

At 11:00 a.m. ET, the S&P 500 was down 3.2%, while the Nasdaq Composite had fallen 4.95%. The Nasdaq-100 was on track to lose approximately 5.4%, putting more than $2.2 trillion in market value at risk if the losses held.

Technology and semiconductor companies faced some of the steepest declines. Nvidia fell 6.4%, while the Philadelphia Semiconductor Index dropped nearly 11%. Tesla and SpaceX also recorded losses of more than 10% at the time of Reuters' report.

Investors are concerned that new political leadership could increase scrutiny of AI infrastructure projects, potentially slowing data-center construction and raising costs for companies investing heavily in the sector.

The selloff also reflected broader concerns about elevated technology valuations and the sustainability of AI-related spending.

Crypto Continues to Trade Like a Risk Asset

The latest decline highlights how closely cryptocurrency prices can move with traditional financial markets during periods of uncertainty.

Bitcoin's rapid fall alongside technology stocks suggests that investors were reducing exposure to riskier assets rather than treating crypto as a separate market. Leveraged positions amplified the move as falling prices triggered automatic liquidations.

However, the broader digital asset industry continues to develop beyond short-term price movements.

For example, Samsung Wallet's planned USDC integration with Sui shows how stablecoin payments are reaching mainstream consumer applications. Altcoin Buzz previously covered the integration and the wider growth of Sui's stablecoin ecosystem.

Meanwhile, tokenized real-world assets are expanding across blockchain networks. Robinhood Chain's addition of tokenized stocks and ETFs, alongside developments involving Ondo Finance, illustrates how traditional financial products are increasingly entering onchain markets.

These developments do not protect crypto prices from a wider market selloff. Instead, they show that the industry's longer-term infrastructure growth can continue even as traders respond to short-term macroeconomic pressure.

For now, Bitcoin's ability to recover above $77,000 and eventually reclaim $80,000 will be important for market sentiment. Traders will also watch whether technology stocks stabilize and whether leveraged selling begins to ease.