Bitcoin Reclaims $80,000 in Short-Squeeze Rally Even as Wall Street’s AI Trade Craters
Bitcoin is bouncing hard off this week’s midterm-election lows just as chip stocks sink into a correction — a sign crypto and the AI trade may finally be trading on different scripts.
Bitcoin is reclaiming $80,000 on Thursday in a sharp bounce from this week’s midterm-election lows, even as a separate selloff tied to AI-regulation fears is dragging the Nasdaq into correction territory. The divergence is notable: crypto and AI infrastructure stocks have largely moved together through most of 2026, but Thursday’s price action suggests the two trades may be starting to run on different catalysts.
A Short Squeeze Meets Election Relief
Bitcoin fell toward the $75,600-to-$75,700 range Tuesday night as midterm votes were still being counted, then reversed sharply, climbing back above $80,000 by Thursday. A short squeeze accelerated the recovery: roughly $378 million in bearish crypto positions were liquidated within a single hour, according to crypto.news, with CoinGlass data showing total liquidations across the broader move approaching $747 million. The bounce tracks the same post-election relief trade that sent the Dow up more than 1,100 points on Wednesday, though the framing cuts in the opposite direction from chip stocks: where semiconductor names are selling off Thursday on fears that Democrats will tighten AI-infrastructure rules, bitcoin’s rebound reflects relief that early worries about a tougher digital-asset regulatory stance under a Democratic Congress haven’t yet translated into concrete proposals.
ETF Flows Turn Positive — For Now
After three straight days of outflows totaling roughly $1.16 billion — including last Friday’s $643.2 million exodus, plus $398.6 million on Monday and $115.6 million on Tuesday — spot bitcoin ETFs took in a net $74.6 million on Wednesday, November 4, according to Farside Investors data. Fidelity’s FBTC led inflows at $236.7 million, with smaller additions into ARKB and BITB, even as BlackRock’s IBIT alone shed another $201.2 million. Not everyone is convinced the bounce holds: Maelstrom co-founder Arthur Hayes said he remains near-term bearish given the ongoing AI-stock selloff, though he argues a deeper market crisis could ultimately force central banks into rate cuts that would be bullish for bitcoin over a longer horizon. CryptoQuant’s pseudonymous analyst CryptoZeno flagged the platform’s Cycle Extremes Index at 15.8% on a 30-day average — a “Watch / Mild Pressure” reading — cautioning that the broader correction “may not be over.”
Why It Matters
Thursday’s split screen — bitcoin climbing while the Nasdaq sinks into correction territory on AI-regulation fears — is one of the clearest signs yet that crypto and the AI infrastructure trade are starting to decouple after moving largely in tandem for most of 2026. It follows FactSheets’ coverage of last week’s ETF outflow wave and comes as names like Big Digital Energy and the rest of FactSheets’ Crypto coverage continue to track the sector’s volatility. For ongoing coverage of today’s broader market action, see FactSheets’ Market coverage and the Stock Fact Sheets hub.
This article is for informational purposes only and does not constitute investment advice. Cryptocurrency prices are highly volatile, and figures cited above reflect trading as of November 5, 2026 and are subject to change; always do your own research or consult a licensed financial advisor before making investment decisions.
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