Bitcoin Selloff Erases Post-Election Rally in a Day

The bitcoin selloff on Thursday wiped out the entire post-election bounce in a single session, and anyone who bought the Wednesday rally felt it. Bitcoin dropped about six percent to roughly seventy-five thousand seven hundred dollars, according to The Block, after touching an intraday low just under that level.

One day earlier, the coin had climbed back above eighty thousand dollars as traders cheered the midterm results. That optimism lasted about a day. Here is what happened, who got hurt and what the people watching the charts are saying.

Wall Street dragged crypto down

This was not a crypto-only problem. A sharp slide in tech and AI stocks hit crypto markets hard. By the close, the Nasdaq Composite was down about five and a half percent, the S&P 500 had lost more than four percent and the Dow fell more than three percent, based on Yahoo Finance market data.

The VIX, Wall Street's fear gauge, jumped around sixty-seven percent. Nvidia shed about nine percent. When risk assets get sold in a panic, bitcoin often trades like a high-beta tech stock, and Thursday was another example of that link.

Over a billion dollars in liquidations

The bitcoin selloff also triggered forced selling across derivatives markets. The Block reported that total liquidations over twenty-four hours topped one billion dollars and hit nearly two hundred eleven thousand traders. Within one four-hour stretch, roughly eight hundred eighty million dollars in positions were wiped out, and most of those were longs betting on higher prices.

Ether fell more than seven percent to about two thousand two hundred forty-seven dollars. Crypto-linked stocks took a beating too. Coinbase and Strategy each dropped about ten percent, while miners Bitdeer and Keel Infrastructure fell around twenty percent. The Official Trump memecoin hit an all-time low after sliding more than twenty percent over two days.

Why the rally did not last

Trading firm Wintermute said the Wednesday bounce mixed relief over the Binance hack, enthusiasm for the election results, hopes of slower AI spending and falling oil prices. Those drivers were short-lived. As OTC trader Jasper De Maere put it, "What matters is that all of them seemed to be so short-lived that it actually didn't really matter."

As reported by Yahoo Finance, research firm K33 had warned earlier in the week that thin trading and rising leverage set bitcoin up for sharp swings. The market was still fragile after the six point three billion dollar Binance hack that rattled prices last week.

Washington adds another headache

Democrats won both chambers of Congress, and that changes the crypto policy picture. Brian Gardner, chief Washington policy strategist at Stifel, said the Clarity Act, the long-stalled bill meant to set rules for crypto markets, is "off the table for the lame duck session" and that odds of a bipartisan deal in the next Congress are "pretty low."

He also expects Senator Elizabeth Warren, who is poised to chair the Senate Banking Committee, to pursue investigations of crypto firms alongside Wall Street banks. Not everyone is gloomy, though. Fundstrat's Sean Farrell argued that the Democratic win could boost bitcoin's appeal as a hedge against bigger federal deficits.

What it means for everyday traders

For newer investors, the bitcoin selloff is a reminder that crypto still moves with the broader market more than many fans admit. When stocks tumble, people sell whatever they can sell quickly, and crypto trades around the clock, so it often reacts first. That is one reason weekend and overnight moves can look so dramatic on a phone screen.

The Block also noted that liquidation figures rely on public data and may understate the real damage. In plain terms, the true number of traders caught out could be higher than the headline totals suggest. Anyone using borrowed money should expect more wild days, and anyone simply holding long term may want to ignore the daily noise and focus on a plan they can stick with.

What to watch next

For anyone tracking the bitcoin selloff, Wintermute pointed to seventy-three thousand dollars and sixty-eight thousand dollars as the next levels to watch if weakness continues. The firm said it needs to see bitcoin reclaim and hold eighty thousand dollars before turning more positive.

The bigger lesson is about leverage. Moves like this punish people who borrow to trade, and a one-day swing of this size shows how quickly gains vanish. This is news, not financial advice. Keep following the crypto beat and the politics beat on GenZ NewZ for updates as the market digests the next moves.