Bitcoin Just Wiped Out The Bulls

Bitcoin’s post-election rally was described as a short squeeze, while the reversal was a squeeze on leveraged longs rather than clear evidence of deteriorating fundamentals. The host cited about $1.2 billion in leveraged Bitcoin long positions and argued that liquidation-driven moves can reveal crowded positioning more than underlying value. Bitcoin fell back to around its level from the prior week and retested the weekly 50-day moving average, a level the host characterized as a bull-bear line for traders and algorithms. A sustained move well below it would suggest a failed breakout, but he was not yet deeply concerned.

The selloff was broad, not confined to crypto. The S&P 500 fell 4.4%, the NASDAQ 5.5%, the Dow 3.4%, and the Russell 2000 4.4%; the NASDAQ 100 recorded its largest daily decline since the 2020 pandemic, and the S&P 500 lost about $3 trillion in value. Semiconductors dropped 12%, their second-largest daily decline on record. Nvidia fell about 9%, AMD and Micron about 17%, and Sandisk 22%. The host saw the concentrated chip losses and abrupt shift in sentiment as signs of a technical, fear-driven downturn rather than a fundamental change.

The VIX rose roughly 70% to 28.18, but remained below its reading above 52 during the April 2025 tariff selloff. U.S. leveraged ETFs had taken in $15 billion in October, their largest one-month rolling inflow in at least two years. The host said that buildup of leverage amplified the decline, as forced position reductions can intensify market moves. The episode’s central distinction was between a sharp repricing caused by positioning and proof that the longer-term investment case had changed.

Bitcoin recovered to around $76,000 and was later quoted at $75,526, but lagged the relief bounce, while gold rose about 1%. Bitcoin ETFs shed $430 million after the technology-stock selloff. The host said ETF flows generally follow price, with outflows on down days and inflows on up days, rather than treating the withdrawals as independent evidence of a lasting change in demand. He also noted that the NASDAQ was more than 10% below its recent high while Bitcoin remained $17,000–$18,000 above its low, and questioned whether even a 20% NASDAQ decline would necessarily send Bitcoin to $10,000.

A slowdown in AI data-center construction could unwind crowded trades, the host said, but he considered fears of a U.S. AI ban highly unlikely. He left open whether Nvidia’s bounce marked a bottom after forced selling or was only short covering. That uncertainty matters to the Bitcoin outlook because the selloff in technology shares and crypto occurred together, but the host did not treat that correlation as proof that either asset’s fundamentals had changed.

On regulation, the host said the CFTC had cleared regulated perpetual futures on stocks and crypto. A judge allowed stock perpetual futures to keep trading, while writing that the legal challenge was likely to succeed. He also cited new SEC guidance addressing governance and whether tokens may be securities or commodities. Despite the Clarity Act no longer proceeding as previously understood, he said regulators were still advancing crypto rules.

Mercado Bitcoin, Brazil’s largest crypto exchange, reported a $46 million security breach. On-chain analysts said withdrawals continued for four hours after the exchange stated that outflows had stopped. The host also cited about $11 billion in outflows from Binance and said the bleeding appeared to have stopped.