AI Trade Selloff: $1.24B Liquidated, 88.6% Longs, as Bitcoin Followed the Chip Crash

The AI trade selloff reached crypto in one hour. On November 5, as the Nasdaq 100 fell 6.4% in its worst session since the March 2020 Covid panic, Bitcoin dropped from $78,767 to $75,986 and CoinGlass counted more than $560 million of liquidations in sixty minutes, $530 million of them longs, per CryptoPotato. The largest single forced close of the day was a $6.62 million position on Hyperliquid.

The move matters less for the size of the flush than for what drove it. One day earlier the market had squeezed shorts after the US midterms. Twenty four hours later the same positioning got punished from the other side, and the trigger came from semiconductor stocks, not from anything inside crypto.

AI Trade Selloff: What Hit Bitcoin Liquidations on November 5

The equity tape was the catalyst. The Philadelphia Semiconductor Index fell 12%, its worst day since March 2020, while the Nasdaq lost 5.5%, the S&P 500 4.3% and the Dow 3.4%, CoinDesk reported. It was the worst US session since the April 2025 tariff announcements.

The explanation offered by desks was political and sectoral. The midterms gave Democrats control of both chambers of Congress, and investors started pricing slower data center construction. Joshua Lim of FalconX pointed to "the implications of slower data center buildout" coming into focus, and said the Wednesday relief rally had been driven by short covering into a well telegraphed result, per the same CoinDesk report. Carlos Guzman of GSR added that investors were already questioning returns on AI infrastructure spending, with disappointing chipmaker earnings adding pressure.

That link runs straight into crypto through miners, since the AI data center trade matters increasingly to them, CoinDesk noted. Crypto miners fell 15% to 20% on the day and digital asset stocks dropped more than 10%, per the same report. Bitcoin itself fell about 5%, which is a smaller drawdown than the chip index, but the speed of the drop says the derivatives book was not positioned for it.

Long Liquidations Hit $1.24B as Open Interest Fell Below $26B

The intraday sequence shows how fast the book unwound. Bitcoin went from $78,767 to $77,021 in 25 minutes and to $75,986 after an hour, according to CryptoTicker citing CoinGecko. More than 165,000 traders were liquidated over the day, per CryptoPotato.

By about 03:32 UTC on November 6, the CoinGlass 24-hour total stood at $1.24 billion, of which $1.10 billion, or 88.6%, was long, Phemex reported. Bitcoin alone accounted for $325.18 million, 90.2% long. Phemex flagged that the aggregate includes stock linked tickers, which is a reminder that liquidation dashboards now mix crypto with tokenized equity exposure on the same venues.

Open interest confirms that this was a forced unwind and not just a price move. Aggregate open interest fell below $26 billion, its lowest since mid September, from $28 billion earlier in the session, CoinDesk said in its live coverage citing Coinalyze. CoinDesk called it the largest wipeout since October 28 to 29, when Bitcoin fell from near $82,000 to $76,000.

A $2 billion drop in open interest alongside a long-heavy liquidation print is the classic signature of forced selling. Price falls, margin calls cascade, and the positions disappear from the book instead of changing hands to new shorts. Until open interest starts rebuilding, the market is lighter, which cuts both ways: fewer longs left to liquidate below, and less fuel for a squeeze above.

Why the Midterm Short Squeeze Reversed So Fast

The rally into November 5 was built on forced buying. Bitcoin had run from a seven week low near $75,600 to roughly $81,000 as about $380 million of shorts were liquidated on the way up, CryptoTicker reported. Short liquidations create buy orders, but they do not create new demand, and that is the weak point of any squeeze.

The spot side never fully joined. On November 4, US spot Bitcoin ETFs took a net inflow of $74.6 million after three days of outflows, with Fidelity's FBTC adding $236.7 million while BlackRock's IBIT saw $201.2 million leave, per CryptoTicker citing crypto.news. A split tape like that is not the steady spot bid that holds a rally when equities break.

So when the chip selloff hit, longs opened during the squeeze were the marginal positions, and they had the least room. Phemex showed a 24-hour low of $75,259 on its BTC/USDT pair, which put price below the Wednesday low near $75,600 that CryptoPotato had cited as support. Stops resting under a widely watched low like that tend to feed the same cascade.

In orderflow terms, this is what a CVD divergence warns about. If cumulative volume delta on perps rises during a rally while spot delta stays flat, the bid is coming from short covering. Once that inventory is spent, the next aggressive flow sets the direction, and on November 5 it came from sellers reacting to equities.

What the Orderflow Says Into the Jobs Report

Correlation is now the main variable. Jasper De Maere of Wintermute told CoinDesk that crypto held up relatively well against the AI stock turmoil, adding: "Let's see where we land in the short term here; medium term still glass half full." With correlation across assets running high, he advised watching for bargains over time. For a perp trader that translates into a simple rule: until the link to the semiconductor index loosens, Nasdaq futures are part of the Bitcoin chart.

Friday brings two more catalysts. CryptoTicker lists the US jobs report, with a FactSet consensus of about 65,000 jobs and 4.2% unemployment, alongside a Bitcoin options expiry. Its options count for that expiry showed 24,912 calls against 8,223 puts, which means a lot of upside exposure is set to expire or get rolled after a day that went the wrong way for it.

Three signals separate a bottoming process from a continuation. First, open interest: if it rebuilds from below $26 billion while price holds above $75,000, new positions are entering with conviction. Second, the funding rate: if funding stays positive while price drops, longs are still paying to hold, which keeps the liquidation risk below the market. Third, liquidation clusters: after a long flush the nearby long clusters are thin, so the next large pocket of forced orders usually sits on the short side, above the $78,000 to $79,500 zone that crypto.news had flagged as support before Thursday, per CryptoTicker.

On Buildix, the BTC pair view shows CVD, open interest, funding and VPIN for Hyperliquid's BTC market on one screen, and the liquidation map shows where forced orders are stacked after the flush. Watching perp delta against open interest in real time is how you tell short covering from fresh demand on the next bounce.

The midterm squeeze and the AI trade selloff happened a day apart, but they were the same story told twice. Crypto derivatives were positioned for an event, the event resolved, and the tape then handed control to whichever side had borrowed the most. The cleanup that followed left the book lighter than at any point since September, which is the condition the next real trend will start from.