Bitcoin, crypto stocks slide as AI selloff hits U.S. digital asset sector

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Bitcoin, crypto stocks drop on AI selloff

Highlights

U.S. midterm election results granting Democrats control of Congress stoke concerns over data-center buildout delays tied to AI, triggering a digital asset sector selloff.
Crypto stocks such as Coinbase, Circle, and BitGo fall 10–15%, while miners drop 15–20% and over $1 billion in crypto derivatives positions are liquidated, the largest wipeout since late October.
Bitcoin declines 5.5% in 24 hours, returning to pre-rally levels, with Ether, Solana, XRP, and Hyperliquid posting 6–7% losses, amplifying tech sector weakness linked to AI spending worries.

Election fallout and AI concerns drive market retreat

As reported by CoinDesk, the selloff gathers pace as investors digest the outcome of Tuesday's U.S. midterm elections, which hand Democrats control of both chambers of Congress and raise concerns that opposition could slow data-center construction tied to the AI boom.

That shift hits parts of the crypto market that have become more exposed to AI spending trends. Analysts at FalconX and GSR say fears over a slower data-center buildout are adding to existing concerns about returns on heavy AI infrastructure investment, while disappointing chipmaker earnings add further pressure.

Joshua Lim, global co-head of markets at FalconX, says fresh selling returns to the market as the implications of slower data-center expansion come into focus. Carlos Guzman, vice president of research at GSR, says the midterms appear to trigger the selloff and deepen worries that were already building around AI spending efficiency.

Crypto equities underperform as liquidations top $1 billion

Digital asset-related stocks are among the hardest hit as the broader technology retreat deepens. Coinbase, Circle and BitGo drop between 10% and 15%, while Strategy loses 9.6%; crypto miners, many of which have been shifting toward AI computing, tumble 15% to 20%.

Bitcoin is down about 5.5% over 24 hours and returns to levels seen before Wednesday's rally, while Ether, Solana, XRP and Hyperliquid post somewhat steeper losses of 6% to 7%. More than $1 billion in crypto derivatives positions are liquidated over the same period, mostly from bullish bets, marking the largest wipeout since at least Oct. 28-29, when bitcoin fell from nearly $82,000 to $76,000.

Wintermute's Jasper De Maere says investors should be cautious about drawing broad conclusions from a single trading session. He says crypto is holding up relatively well compared with AI-linked stocks and that wider adoption still supports a constructive medium-term outlook, even as elevated cross-asset correlations keep near-term volatility high.

Concerns about U.S. AI data-center expansion have been mounting as higher financing costs, construction delays and power constraints cast doubt on how quickly new capacity can come online. In our earlier coverage, we noted that only a minority of planned projects were viewed as credible, while cost overruns and community pushback were adding to investor unease about whether developers can deliver returns on massive capital commitments.

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