Morning Minute: Bitcoin Erases Election Rally as AI Stocks Crater

Morning Minute is a daily newsletter written by Tyler Warner. The analysis and opinions expressed are his own and do not necessarily reflect those of Decrypt. And check out our daily news show 'FOMO HOUR' covering all of the top stories and market action.

GM!

Today’s top news:

• Crypto majors fall 4-6% as AI stocks crash; BTC at $76.1k
• Over $1.1B in crypto longs liquidated on the day
• Dems say they will investigate Trump business dealings, starting with WLFI
• Solana Labs introduced Leap as a new mobile trading app
• Lighter sees 2nd highest day of revenue since February

📉 Bitcoin Erases Election Rally as AI Stocks Crater

On Wednesday, the market decided a Democratic Congress was good news. Stocks had their best day in three months, Bitcoin climbed back over $80,800, and Trump posted on Truth Social that the market “just hit another Record High” with 401(k)s “through the roof.”

On Thursday, the market changed its mind.

The S&P 500 fell 4.36%, its worst session since the Liberation Day tariffs in April 2025. The Nasdaq dropped 5.52% and closed in correction, more than 10% below its record from last month. The Dow shed 1,833 points.

The damage concentrated in one place. The iShares Semiconductor ETF fell more than 12%, its worst day since March 2020. Micron lost 17.5%, AMD 17.3%, Marvell 16.4%, Nvidia 9.3%. The Magnificent Seven shed roughly $1 trillion in market value. The VIX touched 28.09 intraday, its highest since March. By the close, the U.S. stock market had lost $3T in value - more than the entire market cap of crypto.

Notably, the thing that spooked investors was the same election result that lifted everything a day earlier. Several states where Democrats won have active local opposition to data center construction, and the market spent Thursday pricing in slower permitting and tighter oversight of the AI buildout. Ipek Ozkardeskaya at Swissquote put it simply: “We suspect there is going to be some scrutiny on this aggressive AI buildout.” Rate expectations moved too, with December hike odds falling to 70.1% from 82.7%.

Crypto did not sit this one out. Bitcoin fell 5.4% to $75,871, below where it traded before the election. Ethereum dropped 7.6% to $2,239, a steeper fall than the Nasdaq. XRP lost 9.8%, and Hyperliquid fell 4.9%. The CMC20 index fell 6.29%. Almost $1.1B in crypto longs were liquidated on the day, before a slight relief rally overnight.

Two assets held up. Zcash fell 0.8% and Monero 2.2%, both less than the broad market, and both remain up on the week. Over the past year, Zcash is up 146% and Monero 74% while BTC is down 26% and ETH down 34%. The privacy trade is clearly still alive and looking as strong as ever.

Friday’s October jobs report is next. After a week where the market read the same political outcome two opposite ways inside two sessions, it is fair to wonder how much anyone actually knows right now. We will find out soon…

🌎 Macro Crypto and Markets

• Crypto majors are very red down 4-6%; BTC -5% at $75.9k; ETH -8% at $2,240; SOL -7% at $90.1; HYPE -5% at $78.40; ZEC -1% at $1,310
• WLFI (+3%), PEPE (+3%), and ARB (+4%) led top alt movers
• Oil +2% at $90; Gold -1% at $4,080
• Stock futures are rebounding after yesterday’s massive selloff; DOW -0.9%, Nasdaq +1.6%
• Over $1.1B in crypto longs were liquidated in the past 24 hours during the crypto selloff
• Representative Robert Garcia, expected to chair House Oversight under the new Democratic majority, said the committee will investigate the Trump family’s business dealings including its crypto ventures, with World Liberty Financial likely among the first targets and inquiries possibly beginning in February
• Trump-backed American Bitcoin swung to a $126 million third-quarter profit from a $57.2 million loss in Q2, driven by a $197 million gain on its bitcoin holdings as prices rose
• Zcash’s NU7 upgrade will permanently freeze about 12,224 ZEC worth roughly $15.6 million by invalidating the only transaction format that can move coins out of Sprout, the chain’s original 2016 privacy pool; the upgrade also cuts target block time from 75 seconds to 25 seconds
• Solana Labs launched Leap, a mobile app for trading tokenized stocks, ETFs, metals, currencies and crypto around the clock, built by the Dialect team Solana Labs acquired this year
• China’s central bank said it halted Solana’s planned Accelerate China 2026 events in Shanghai and other cities and will investigate the domestic entities that placed the project’s advertising in the Lujiazui financial district

Corporate Treasuries & ETFs

• The Bitcoin ETFs saw $430M in net outflows on Thursday; the ETH ETFs saw $100M in outflows

Meme Coin Tracker

• Meme leaders were mostly red; DOGE -6%, SHIB -4%, PEPE +3%, PENGU -7%, TRUMP -2, SPX -5%, BONK -4%
• Robinhood chain leaders were very red; Pons -12% to $128M; Cashcat -8% at $94M; AI -23% at $40M; HOOKR +20% and Priors +8% led top movers
• Solana top movers included BIRB +32%, COGE 78x, and Diamond +900%; Cards -25% giving back recent gains

💰 Token, Airdrop & Protocol Tracker

• Hyperliquid led onchain protocols in revenue with $2.72M, followed by Pump.fun at $1.35M and Papertrade at $822k
• Lighter had its 2nd highest day of revenue since early Feb yesterday with $314k
• Pump.fun opened business development roles covering perpetual futures, prediction markets and a trading terminal, in an expansion beyond memecoins
• Pump.fun also introduced a new Diamond mode for callouts, rewarding higher market cap calls and longer term holds

🚚 What is happening in NFTs?

• NFT leaders were mixed; Punks even at 30.4 ETH, BAYC -1% at 5.6 ETH, Pudgy even at 2.25 ETH
• Normies (+4%) led top movers