Bitcoin reaches seven-week low as investors back away from risky bets

Bitcoin slid below $76,000 on Thursday, dropping around 6% at one point to a seven-week low, Bloomberg reported. The decline coincided with a broad selloff in U.S. stocks: the Nasdaq 100 was down as much as 6.4%, dragged on by chipmakers amid weak earnings guidance and concerns that Democratic control of Congress would bring tighter oversight of the AI industry.

Crypto-related stocks also fell on Thursday: shares of publicly traded bitcoin treasury company Strategy, crypto exchange Coinbase, and trading platform Robinhood were down more than 10%.

The crypto market has yet to recover from the hack at Binance, which was followed by a decline in retail investor activity, Bloomberg notes. Volatility in tech stocks has added to that pressure despite falling U.S. Treasury yields, which typically support speculative assets, Bloomberg added.

Bitcoin’s decline is tied to the broader rout in U.S. tech stocks, reckons Vetle Lunde, head of research at K33, a Norwegian investment and brokerage house specializing in cryptocurrencies and digital assets. He sees the moves as a reaction to the U.S. midterm elections, with broader markets remaining extraordinarily volatile as investors assess the implications of the Democrats’ victory.

From October 29, when hackers attacked Binance, through Wednesday, November 4, investors pulled $1 billion from spot bitcoin ETFs, Bloomberg reported. BlackRock’s IBIT suffered the largest outflows, losing around $900 million over that period.

As recently as a month ago, almost every coin held by short-term holders, investors who bought bitcoin within the last 155 days, was in profit, according to data from Glassnode, a Swiss crypto market analytics company. That picture has now changed: the share has fallen sharply as bitcoin’s price has declined, Glassnode analysts wrote in a report this week. “Most short-term holder coins are now held at a loss,” they said.