Key TakeawaysBitcoin drops to a six-month low as weakness in AI and tech stocks triggers broad risk-off sentiment.Spot Bitcoin ETF outflows and selling from a long-term 2011 wallet added downside pressure.Derivatives show muted demand for bullish leverage, but whales at major exchanges bought the dip.Bitcoin fell to a six-month low of $94,590 on Friday, extending an 11% weekly decline as the broader tech sell-off spilled into crypto markets. The downturn came as AI-related stocks suffered sharp drawdowns, reducing overall risk appetite and limiting demand for leveraged long exposure.The move erased $900 million in BTC leveraged long positions, though this accounted for less than 2% of total open interest — a far smaller impact than the cascading liquidations seen on Oct. 10, when thin liquidity amplified losses across derivatives markets.Macro Fears Add Pressure as Traders Reassess RiskU.S. macro uncertainty added to the bearish mood. President Donald Trump’s renewed push to cut tariffs to reduce food prices raised fresh concerns about upward inflation pressure. Allianz chief economic adviser Mohamed El-Erian warned of rising recession risks as lower-income households face an “affordability crunch” that could spread across the economy.Derivatives Show Weak Bullish Demand But Limited Bear ConvictionDespite the sell-off, the BTC futures premium remained near 4%, slightly below the neutral 5% threshold but above recent lows. The data indicates muted bullish leverage, yet does not signal strong conviction from bears either.AI Sector Crackdown Fuels Sell-Off as ETF Outflows AccelerateThe correction across risk assets was partly driven by a sudden reversal in the once-dominant AI narrative. Concerns around inflated earnings, rising costs, and slowing demand triggered significant drawdowns in leading AI-focused firms.Legendary investor Michael Burry questioned whether companies have been propping up earnings by extending depreciation schedules for computing hardware, noting that Amazon was the only major tech firm to shorten its depreciation timetable.At the same time, U.S. spot Bitcoin ETFs saw $1.15 billion in net outflows over two days, adding further pressure. While the amount represents less than 1% of total ETF assets under management, the timing coincided with increased uncertainty.Additional selling emerged from a single 2011-era Bitcoin holder, though analysts emphasized the event was isolated and not indicative of broader long-term investor behavior.Options Market Shows Resilience Despite Price DropThe 30-day BTC options delta skew held near 10%, above the neutral 6% level but well below the 16% fear peak seen last month. Despite Bitcoin being down 24% from its all-time high, the options market has remained relatively steady, suggesting resilience among sophisticated traders.Broader Risk Markets Are Derisking — Keeping Bitcoin Under PressureMultiple companies with market caps above $20 billion — including CoreWeave, Nebius Group, Symbiotic, Super Micro Computer, and Ubiquiti — posted double-digit declines since Nov. 5. With recession fears rising and volatility returning, traders continue shifting toward cash and defensive assets.Unless macro and AI-sector uncertainty eases, Bitcoin may remain under sustained pressure, even if derivatives positioning hints that some pro traders are beginning to buy the dip.
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