Bitcoin slipped to $75,618, a seven‑week low near its 50‑week moving average, after U.S. midterm election results were announced. By Thursday morning the price had recovered to around $80,000.
Equity Market Reaction
The Nasdaq Composite fell 5.52% to 24,315, marking its deepest one‑day decline in 19 months, while the Nasdaq‑100 dropped 6.4%, its worst session since March 2020. The S&P 500 declined about 4.4% and the Dow Jones Industrial Average fell 3.4%.
Bitcoin moved in tandem, sliding from above $80,800 to just under $76,000 by the close, a 5.2% daily loss. Gold rose 0.6% to $4,094, reflecting a risk‑off shift.
Hedge Fund and Asian Market Impact
Goldman Sachs data show hedge funds net‑sold roughly $20 billion of technology stocks over two weeks, erasing AI‑related long positions built since early 2025. In Seoul, the KOSPI dropped more than 8% at the open on Friday, triggering a 20‑minute trading halt after a 5.28% decline the previous day. Four major Asian stock markets have fallen over 20% since June.
U.S. Treasury Yields and Policy Outlook
U.S. 10‑year Treasury yields rose only five basis points despite the market sell‑off, prompting concerns about a potential fiscal impact from the AI sector decline.
Crypto Sector Developments
Regulatory activity continued: the SEC released updated FAQs on token buybacks, governance and network upgrades, while the CFTC announced that equity perpetual futures may trade on registered exchanges. A consortium of financial firms, including Citadel and Cboe, filed a lawsuit alleging jurisdictional overreach.
Institutional crypto initiatives progressed with ICE and Trade.xyz planning a U.S. venue offering 24/7 trading across crypto, stocks, indices, commodities and currencies. Morgan Stanley joined DTCC’s tokenization service, becoming one of the first banks to tokenize real‑world assets.
Coinbase hit a 970‑day low after Morgan Stanley downgraded the exchange and cut its price target by 53% due to weaker earnings expectations. In contrast, Circle reported quarterly net income of $226 million while reducing its workforce by about 5%.
Security Incidents
Binance disclosed that a hack affected $6.34 billion in assets, with $2.85 billion frozen or intercepted. The firm reported that 98% of the impacted tokens had been replenished by the end of October. The FBI attributed the attack to North Korean actors.
Additional breaches were reported by Trezor, Chainalysis, Mercado Bitcoin, and BTCPay Server, affecting hardware wallets, customer data and exchange operations.
