The post-election optimism across financial markets quickly reversed as AI-related stocks experienced a significant sell-off. Cryptocurrencies also retreated, although they outperformed several technology stocks despite more than $1 billion in forced liquidations.

U.S. equities posted their biggest single-day decline since President Donald Trump’s April 2025 Liberation Day tariff announcement.

The Nasdaq dropped 5.5%, followed by a 4.3% decline in the S&P 500 and a 3.4% loss for the Dow Jones Industrial Average (DJIA).

Technology shares were among the hardest hit as investors continued pulling back from the AI trade. The Nasdaq 100, which carries greater exposure to technology companies, plunged 6.4%. This was its worst daily performance since the pandemic-driven market crash in March 2020.

The semiconductor sector faced even greater pressure. The Philadelphia Semiconductor Index tumbled 12% on Thursday, recording its largest daily loss since March 2020.

Bitcoin declined 5.2% in 24 hours, slipping below the $76,000 level. Ether (ETH) dropped 7.5% to $2,241.47, while XRP and Solana both fell approximately 5.5%.

Gold managed to advance as investors moved toward traditional safe-haven assets. Despite retreating from its session high, the metal remained 0.6% higher at roughly $4,094 an ounce.

The broader decline followed Tuesday’s U.S. midterm elections, which gave Democrats control of both chambers of Congress. Investors are now evaluating whether increased political opposition could slow the construction of data centers. Such delays could affect the rapid expansion of AI infrastructure, which has increasingly become an important source of demand for Bitcoin mining companies.

Joshua Lim, global co-head of markets at institutional cryptocurrency brokerage FalconX, said investors were facing renewed selling pressure as they considered the possibility of slower data center development.

Lim explained that Wednesday’s market recovery was primarily fueled by traders covering short positions after an election result that had largely been expected by investors.

Carlos Guzman, vice president of research at digital asset trading firm GSR, said questions about the financial returns from massive AI infrastructure spending were already weighing on market sentiment. The election outcome has created additional uncertainty around the sector.

According to Guzman, stronger resistance to data center projects could delay infrastructure expansion and deepen concerns about whether the substantial capital invested in AI will ultimately prove profitable.

He also cited disappointing semiconductor company earnings as another reason behind the latest wave of selling.

Crypto Market Shows Resilience as Liquidations Exceed $1 Billion

Although leading digital assets recorded significant declines, their performance was relatively stronger than that of several AI-focused equities.

Bitcoin dropped roughly 5.5% over the past 24 hours, reversing most of its previous day’s gains and returning to levels seen before Wednesday’s recovery.

The sudden downturn also triggered a substantial wave of liquidations across cryptocurrency derivatives exchanges. Traders who had borrowed funds to bet on rising prices faced forced closures as the market moved against their positions.

CoinGlass data indicated that more than $1 billion in leveraged crypto positions were liquidated within 24 hours. Most of the losses came from long positions, making it the largest liquidation event since at least October 28–29, when Bitcoin declined from nearly $82,000 to approximately $76,000.

Guzman said the market’s earlier recovery was supported by optimism surrounding the geopolitical outlook after the midterm elections. However, investors began reducing exposure to volatile assets on Thursday, while leveraged positions accelerated the downward movement.

Jasper De Maere of crypto market maker Wintermute cautioned against treating one weak trading session as a signal of a broader market reversal.

He emphasized that cryptocurrencies had demonstrated relative strength against AI-linked equities during the latest downturn. Continued adoption across the digital asset industry also provides support for the sector’s longer-term growth prospects.

While acknowledging that near-term price movements remain difficult to predict, De Maere said he remains optimistic about the medium-term outlook. He suggested that investors monitor the ongoing correction for potential entry opportunities, particularly given the strong relationship between movements across different asset classes.