Bitcoin briefly cratered to $75,700 on Thursday, completely erasing the post-election rally that had propelled prices above $80,000 just 24 hours earlier. The sharp reversal came amid a sweeping Nasdaq selloff that pushed the index deeper into correction territory and triggered cascading liquidations exceeding $1 billion across digital asset markets.
The cryptocurrency had climbed as high as $80,500 on Wednesday, riding a wave of optimism in risk assets following Democratic gains in the U.S. midterm elections and declining oil prices, according to Cointelegraph. However, the momentum proved short-lived as broader equity markets reversed course, dragging Bitcoin down approximately 6% to its session lows.
Ether suffered even steeper declines, dropping 7% alongside Bitcoin's descent, The Block reported. The synchronized downturn in cryptocurrencies and technology stocks highlighted the continuing correlation between digital assets and traditional risk assets, particularly during periods of acute market stress.
Crypto-adjacent equities bore the brunt of the selling pressure. Strategy, the corporate entity formerly known as MicroStrategy and a major Bitcoin treasury holder, plunged in double-digit percentage terms. Cryptocurrency exchange Coinbase and publicly traded Bitcoin mining firms similarly posted significant losses, with all three categories experiencing declines in the double digits, according to Bitcoin Magazine.
The violent price action forced $1.03 billion in crypto liquidations as leveraged positions were automatically unwound, The Block noted. Such mass liquidations typically accelerate during rapid downturns as exchanges close margin positions to prevent further losses, exacerbating price volatility. The speed of the reversal underscored how quickly sentiment can shift in cryptocurrency markets, particularly when supported by leverage.
The liquidation event represented a significant de-risking across futures and perpetual markets, where traders had accumulated positions expecting continued upside following the midterm results. While crypto markets initially celebrated the electoral outcomes, the subsequent equity turbulence served as a reminder that digital assets remain tightly coupled to traditional market dynamics. When the Nasdaq entered correction territory, crypto markets followed with even greater velocity, given their higher beta to risk appetite.
Strategy's specific mention in the selloff highlights how corporate Bitcoin treasury strategies amplify volatility in both directions. As a proxy for Bitcoin exposure through traditional equity markets, Strategy's double-digit decline reflected investor concerns about mark-to-market losses on its substantial cryptocurrency holdings during the downturn. Similarly, mining stocks' underperformance illustrated the operational leverage these companies possess relative to the underlying asset price.
By late Thursday afternoon, Bitcoin had stabilized near $76,000 as the Nasdaq continued its slide into correction territory. The swift roundtrip from $80,500 to $75,700 marked one of the most volatile 24-hour periods for the cryptocurrency in recent months, demonstrating the fragility of post-election gains when confronted with macroeconomic headwinds and equity market turbulence.