美国中期选举民主党横扫，AI板块暴跌引发市场恐慌

Bankless Nation, it's the first week of November. We got a blue wave and a black swan. We got the midterm results in. Uh first, the markets hated the Democrat sweep. Then it loved it the day after the midterms. And now on Thursday morning, we are seeing some of the worst selling that we have seen in many years, many, many years. The worst decline in both the NASDAQ and the S&P since something like 2018. In just the first 40 minutes of trading, the S&P 500 has raised $2 trillion in the market cap.

There was a a midterm rally right after the midterms got over and that's all completely gone. Uh crypto is getting hit as well, but I would say not as bad. Uh was this because of the midterms or was this the AI bubble popping or was this something else?

I don't know, David. It seemed like we were just out of the woods on the crypto side from the biggest hack in crypto history and the biggest heist ever. $6 billion Binance hack that happened last Friday. Crypto went down, then it was recovering. Things looked good and now we have this AI sell-off to contend with. But we got to go over the details of the Binance hack and put it in historic context. Actually go through the retrospective of what happened.

And it also wasn't just crypto bank, a major crypto bank that was hacked last week. a regular bank was hacked as well and they use crypto as their getaway car. I want to tell you about this because last week we posed the question, hey, can this type of thing happen to traditional banks, fiat? If so,

I thought banks are safe.

They're not safe. Okay, I want to give you the story of of how hackers got in, what they did with the funds and what's going to happen next.

Also, it's Ethereum Devcon happening in Mumbai, India in the moment. So, we get to go uh down onto the ground, get some takes from people who are there on the streets. Uh there was updates to the lean road map for Ethereum from Justin Drake making Ethereum postquantum even sooner. We got updates from layer 2B and also just a sample of what Ethereum and Vitalic are focusing on from the Devcon keynote that we get every single Devcon.

But first we're got to just talk about the markets. The markets can't seem to make up their mind. Yeah, there was a Democrat sweep of course. This is the blue wave. The Senate flipped in favor of the Democrats. 54 senators elected, I think two other seats in contention. That is a healthy majority. Also, the the House flipped blue as well. So, there's a full sweep. Both chambers pretty historic win. Both chambers flipping in this way.

And also the numbers, governor races, like definitely this was a blue wave. Some calling it a blue tsunami. I'm I don't know if I'd go that far, but this is definitely the Democrats pushing in to recent Republican gains. I think the answer to why is probably everyone everyone kind of knows. This seemed like a self-inflicted wound from the Trump agenda. I think DC investor had a had a take where he just said, "Look, you know, people aren't into the war, energy prices going up, uh CPI going up.

It seemed like Trump wasn't focused on affordability. Trump had a mandate and he just floundered all of it."

Yes. So even on things like you know border security which was you know somewhat popular the way it was implemented ICE in cities with masks and people I mean this this seemed like it was coming and and certainly uh Democrat voters showed up for it.

But the question as to like what's going on in the markets is still to be determined. In fact, David, maybe we should uh in a minute you could pull up some charts because a lot of this is playing out over real time. But you started, you said this was one of the largest crashes that we've seen in recent memory on the S&P, at least in terms of like volume and time scales here.

Yeah, I keep having to update my numbers on the S&P, but in the last just day and a half of trading, the S&P is down 4%. 4% is just gargantuan for the S&P. That takes it all the way back to June 2026 prices. Uh, but just like the the level of red on this candle, it it straight straight down. Straight down. And the QQQ NASDAQ is even worse because NASDAQ is just so heavily techoriented. Uh NASDAQ is down 6% taking it all the way back to April 2026 prices.

And then you can kind of zoom into specific sectors. Uh and so State Street tech sector ETF uh that's down at 7 7%. Semiconductors SOXX is down 12% just an index of semiconductors. And then we can get into some individual names like Nvidia. Nvidia down 8.6%, Intel down 7%. Not but not only is Intel down 7%, but Intel is off off of its all-time highs by 61%. MU Micron, just an AI uh buildout favorite, down 14% on the day, but also just down 45% from its all-time highs.

There are some assets that I think are getting buffered from this uh from this massive sell-off. Like Amazon is down 2% but on the week it's flat. You know, Google's down 1.5% but it hasn't gone down since it reported its earnings. Apple's actually doing okay. So, if you're an Apple hoarder, you're down 1.5% but you're at near all-time highs. So, the AI infrastructure buildout companies are just getting absolutely walloped. a lot of the AI spenders, uh, Amazon, Google, these aren't doing so bad even though the whole market is down this week.

Uh, and so I think you could definitely say that this is AI bubble popping. Uh, as well as you have some uh, actual specific assets that are selling off specifically because of the Democrat blue wave and these would be all the Elon assets. So Tesla's down really really bad. I would say I would say still too early on this Thursday to call this an AI bubble pop. It does seem like a correction. Like will it you know turn into

correcting though? Micron down 60%, Intel down 40% from its alltime highs.

Absolutely. But the these sectors have had tremendous gains. I guess I guess in general we're back to what summertime in the S&P summertime in the NASDAQ.

Yeah. So if if you're an AI buildout like semi or like Micron doing selling memory, you're back as bad as possible, which is back to April. If you're a Google, if you're an Amazon, you're back to like June. Um

it's weird though. It's it's hard to um call the the the market reaction a result of the the blue wave really and the Democrats control of both um both chambers of of uh Congress because it was originally it was up, right? So like we had kind of a a runup. We had a very green day that everyone was like, "Oh, turns out like getting kicking Trump's chaos out of office is actually good for a variety of reasons that we can Thursday morning."

Everyone changed their mind. Everyone just suddenly changed their mind.

Yeah. Well, my attitude is that this is there was AI tech stock selloff going into the midterms and then midterms took center stage and we focus on that and now that midterms are in the rearview mirror, actually, people still want to sell tech stocks, I guess. So there there were some specific losers like uh you know Trump the Trump media asset was down like 30% even this was on the back of the election results. I wonder what it's at this morning.

And then there's also the Trump memecoin. Don't look at that chart. That chart is down 30% uh post the uh blue wave. Uh and so and as I kind of said like Tesla and SpaceX uh while everything else was rallying post uh midterms, Tesla SpaceX were down bigly just because Democrats are going after Elon. So there there were specific assets that did respond as you would expect them to to the blue wave. Uh overall though, you can kind of just look at the AI industry and see that the AI buildout assets have been down the most.

All right, so AI markets in carnage. Let's talk about our beloved crypto assets because it seemed like on Wednesday we were out of the woods. We just survived this Binance hack. Somehow someway we we were above on Bitcoin the 50we moving average which has been a key. We're in early bull cycle territory. We somehow stayed