This report is for professional investors and information purposes only. Persons without professional investment experience should not rely on it. Not investment advice or a personal recommendation. Cryptoassets are high risk and volatile and you may lose all capital invested. See full risk information at the end of this document.
- Performance: high 30-day correlations with equities left crypto assets exposed, as post-midterm fears of AI data-centre moratoriums drove further weakness. Even so, Bitcoin continues to trade within the $73–78k range we have identified as constructive for now. With 10-year yields declining and signs of seller exhaustion emerging, we view the longer-term set-up as constructive, although a sustained break below $73k or a further rise in equity correlation would weaken this view. The Chart of the Week also suggests Bitcoin’s apolitical character could prove a tailwind over a potentially tumultuous two years.
- Cryptoasset Sentiment Index: remained in negative territory throughout the week, recording levels as low as -0.72, which is almost one standard deviation lower than the average. This suggests that there could be further downside room to go.
- Chart-of-the-Week: underscores Bitcoin’s apolitical features. Annualised returns from 2013 to 2026 show no consistent partisan advantage across the Presidency, House or Senate: returns were higher under Democratic presidencies and Democratic Senate control, but also under Republican House control. This may be consistent with Bitcoin’s role as a global, decentralised and neutral asset, although the sample period is limited and past performance is not a reliable indicator of future results.
Chart of the Week
Performance
Last week, risk assets sold off sharply as the US midterms suddenly turned data centres into a political risk. Crypto held up better than equities, with Bitcoin down around 3% against a 5.5% fall in the Nasdaq-100, but lagged gold (+4.8%), the dollar (DXY +0.3%) and Treasuries (10-year +0.7%). The sell-off was largely confined to equities as stock market volatility jumped (VIX +35% to 25.6); while bond market volatility fell (MOVE -7%) as Treasury yields edged lower (down 5–8bps across the curve) and high yield credit spreads tightened.
On 4 November, the Democrats won control of both chambers of Congress. The initially clean political outcome triggered around $156mn of short liquidations, pushing BTC towards $80.5k. Equities then unwound and pulled Bitcoin lower on fears of a slowdown in AI spending and data-centre build-out, as the winning candidates in key governor races in Texas, Georgia and Ohio had campaigned on data-centre moratoriums or pauses.
During the 5 November sell-off (S&P 500 -4.4%), Bitcoin’s 30-day correlation with both the S&P 500 and the Nasdaq-100 spiked to around 0.8. Global crypto ETP outflows totalled $1.78bn (Bitcoin -$1.32bn, Ethereum -$398mn), with US spot Bitcoin and Ethereum ETFs recording net outflows of roughly $1.03bn in the two trading sessions after the midterms. Our In-house Sentiment indicators remained negative, spilling over into altcoins as our Altseason Index fell to 25/100.
Bitcoin continues to consolidate within the $73-78k region, which we have long notified as a critical trading area composed of the 200-day moving average at $73k, the short-term holder cost basis at $75.5k and the true market mean near $78k. A sustained break below $73k would flip the medium-term view from bullish to bearish with already weak momentum, and an increase the supply of coins held at a loss as price drifts further from the market midpoint (true market mean indicator). Here, short-term holders would likely face larger realised losses and potential further selling pressure. As long as price consolidates and retests this range with resilient holder behaviour, the broader bullish market structure remains intact.
In our recent note to clients after the mid-week sell-off, we commented that the AI sell-off appeared to be driven by financing concerns rather than the technology itself, and that more short-term volatility in risk assets looked likely as equities remain exposed to repricing growth expectations. We noted that Bitcoin has historically been more sensitive to the Dollar and monetary policy than to growth, although its correlation with equities rose sharply during last week’s sell-off. With 10-year yields easing from their highs, on-chain data pointing to seller exhaustion and a still-supportive bipartisan stance on crypto, we think the balance of risks for crypto assets has improved, although downside risks remain material, notably a sustained break below $73k and continued high correlation with equities.
The Chart of the Week underscores Bitcoin’s apolitical character. Annualised returns from 2013 to 2026 show no consistent partisan advantage across the Presidency, House or Senate: returns were higher under Democratic presidencies and Democratic Senate control, but also under Republican House control. This may be consistent with Bitcoin’s role as a global, decentralised and neutral asset, although the sample is short, returns varied by political configuration, and past performance is not a reliable indicator of future results. In our view, the next two years could bring political gridlock, raising the risk of fiscal brinkmanship and larger deficits. In that scenario, Bitcoin’s neutral, non-sovereign characteristics could attract more attention, although political events can also drive sharp short-term volatility, as last week’s sell-off showed.
Bottom Line: High 30-day correlations with equities left crypto assets exposed, as post-midterm fears of AI data-centre moratoriums drove further weakness. Even so, Bitcoin continues to trade within the $73–78k range we have identified as constructive for now. With 10-year yields declining and signs of seller exhaustion emerging, we view the longer-term set-up as constructive, although a sustained break below $73k or a further rise in equity correlation would weaken this view. The Chart of the Week also suggests Bitcoin’s apolitical character could prove a tailwind over a potentially tumultuous two years.
Sentiment
Our in-house “Cryptoasset Sentiment Index” [1] remained in negative territory throughout the week, recording levels as low as -0.72, which is almost one standard deviation lower than the average. This suggests that there could be further downside room to go.
At the moment, 2 out of 15 indicators remain above their short-term trend.
The most notable changes were the 3-month basis rate increasing from last week’s already positive change, whilst funding rates, measured as a z-score relative to their recent history, decreased from last week’s positive change (in notional terms, seven-day annualised funding rose modestly; see Futures, Options & Perpetuals). This suggests that institutional hedging activity has increased, with potentially increased demand for the cash-and-carry trade; whilst retail speculation may have eased, which is in line with our Sentiment indicators.
The Crypto Fear & Greed Index increased slightly over the past week, from 26 to 29, however, is lower post-Midterms which settled at 50 after the initial short squeeze.
Performance dispersion decreased slightly in line with our broader Sentiment indices. The major subsectors—AI, DeFi, L1, L2, Gaming, Memes—all declined within a tight range of -4 to -9% for the week.
Altcoin outperformance vis-à-vis Bitcoin declined to 20% of the altcoins tracked in our index. The two positive return tokens were Monero and Zcash, both privacy coins, suggesting the narrative is still alive-and-well.
Sentiment in traditional financial markets as measured by our in-house measure of Cross Asset Risk Appetite (CARA) has decreased from -0.36 to -0.58 over the past week, although peaking at -0.61 post-Midterms. This signals risk appetite has further declined within TradFi as the macro backdrop worsens for riskier assets.
The CME Bitcoin Commercials Net Positioning metric captures the difference between long and short CME Bitcoin futures contracts. The reading has increased from –13.67% to -11.99% of open interest, further confirming the short squeeze was what helped propel Bitcoin. Traders have yet to increase their short leverage as of yet.
Bottom Line: Sentiment in both crypto and traditional markets remains poor. Our in-house Sentiment Index stayed in negative territory and potentially has room to fall further. Altcoins are likely to keep struggling until Bitcoin finds relief, which will most likely require a recovery in TradFi risk appetite.
Fund Flows
Global crypto ETPs experienced around -1779.4 mn USD in net outflows last week, across all types of cryptoassets, after -751.5 mn USD in net outflows the previous week.
Global Bitcoin ETPs experienced net outflows of -1315.1 mn USD last week, of which -1285.1 mn USD in net outflows were related to US spot Bitcoin ETFs.
The Bitwise Bitcoin ETF (BITB) in the US experienced net inflows of +16.6 mn USD last week.
In Europe, the Bitwise Physical Bitcoin ETP (BTCE) experienced net outflows equivalent to -1.3 mn USD, as the Bitwise Core Bitcoin ETP (BTC1) experienced net outflows of around -6 mn USD.
The Grayscale Bitcoin Trust (GBTC) posted net outflows of -61 mn USD whereas, the iShares Bitcoin Trust (IBIT) experienced net outflows of around -1209.5 mn USD last week.
Meanwhile, global Ethereum ETPs experienced -398 mn USD in net outflows last week, of which US spot Ethereum ETFs recorded net outflows of around -320.6 mn USD on aggregate.
The Grayscale Ethereum Trust (ETHE) posted net inflows of +9.1 mn USD, whilst the iShares Ethereum Trust (ETHA) saw net outflows of -346 mn USD.
The Bitwise Ethereum ETF (ETHW) in the US experienced no net inflows or outflows last week.
In Europe, the Bitwise Physical Ethereum ETP (ZETH) recorded net outflows of -4.8 mn USD, whilst the Bitwise Ethereum Staking ETP (ET32) saw net outflows of -55.7 mn USD.
Altcoin ETPs ex Ethereum also saw net outflows of -37.8 mn USD last week.
Thematic & basket crypto ETPs posted net outflows of -28.5 mn USD on aggregate last week. The Bitwise MSCI Digital Assets Select 20 ETP (DA20) recorded no net inflows or outflows last week.
Bottom Line: Sentiment deteriorated sharply last week, with global crypto ETPs recording -1779.4 mn USD in net outflows, more than double the -751.5 mn USD seen the previous week. Bitcoin outflows took the lead at -1315.1 mn USD; as Ethereum outflows also remained heavy at -398 mn USD. The pressure was broad enough to reach altcoins and thematic baskets as well, suggesting a risk-averse tone across the asset class.
On-Chain Data
The digital asset ecosystem has experienced a tumultuous few weeks. The first major shock came from the Binance hack, the largest digital asset hack on record, which initially pushed prices lower before the market stabilised and recovered. That resilience was subsequently tested by the US midterm elections, which placed renewed pressure on the AI investment narrative and triggered a sharp sell-off across technology and broader equity markets. As concerns around the sustainability of AI-related capital expenditure and future revenues intensified, digital assets were ultimately pulled lower alongside the wider risk-off move.
The hack is also a reminder of the operational, custody and exchange counterparty risks in cryptoasset markets. These can affect prices, liquidity and access to assets independently of macroeconomic conditions.
Despite persistent weakness across individual AI and technology stocks, the headline equity indices had remained comparatively resilient. That changed on 5 November, when the Nasdaq-100 fell 6.4%, its seventh-worst day since 2006 and largest decline since March 2020, while the S&P 500 dropped 4.4%, equivalent to a 5.4-standard-deviation move relative to the past year.
The volatility shock was equally notable. The VIX, which measures the market’s expectation for near-term S&P 500 volatility and effectively serves as a gauge of equity-market volatility, surged around 70% from 16.6 to 28.2, marking its third-largest one-day percentage increase since 2006.
This weakness across equity markets subsequently spilled into digital assets, which also experienced a sharp drawdown on 5 November, with total market capitalisation falling 5.24% and erasing roughly $144bn in value. The move ranked as the 196th-worst daily decline across 3,962 observations, placing it among the most severe 5% of trading days historically. Weakness was broad-based, with Bitcoin declining 5.54% and small-cap assets falling around 6.35%, highlighting that the sell-off extended across the wider digital asset complex rather than being confined to the riskier end of the market.
However, Bitcoin has remained within the $73k-$78k transition range we have highlighted for several weeks, with price continuing to interact with the True Market Mean near $78k and Short-Term Holder Cost Basis around $76k. Through this framework, there is still room for price to move lower within the range without necessarily undermining the broader bull-market structure, provided the lower boundary continues to hold.
At present, the move can be viewed as a constructive retest of the market’s key transition zone. If sustained, this would be consistent with the type of consolidation often observed during bull-market advances. A decisive break below the range, however, would materially weaken this thesis and suggest that the market is losing support around the key pricing levels that have so far defined the broader risk-on structure.
Notably, investor loss-taking remains relatively shallow at around $155mn. This pales in comparison with the November 2025 and February 2026 drawdowns, when realised losses reached roughly $1.7bn and $2.3bn, respectively. On balance, this points to a meaningful degree of investor resilience, with many holders appearing more willing to retain their coins than capitulate into weakness.
One potential explanation for the recent investor resilience is the extent of the reset Bitcoin has already experienced. Following a significant correction, Bitcoin’s price relative to its 200-week moving average now sits in just the 15.9th percentile of its historical distribution, compared with the S&P 500 at 79.5%, Gold at 67.9%, Nasdaq at 64.4%, Silver at 63.9% and the Dow Jones at 62.8%.
In other words, Bitcoin has already moved much closer to its long-term trend reference points, while major equity indices and precious metals remain much more extended relative to their own long-term trends. This may partly explain why Bitcoin has remained comparatively robust as broader risk assets begin to come under greater pressure. Trend-based measures of this kind are not valuation measures and do not by themselves indicate that further declines are unlikely.
Taken together, Bitcoin continues to demonstrate a notable degree of resilience despite a challenging market backdrop. Price remains within the $73k-$78k transition range, whilst key investor cost bases continue to provide support and realised losses remain comparatively shallow, suggesting that investors have so far avoided widespread capitulation. This resilience may partly reflect the extent to which Bitcoin has already reset relative to its long-term trend reference points, particularly when compared with major equity markets. While a decisive break below the transition range would materially weaken the current thesis, continued defence of these levels would, under our framework, be consistent with a retest of key support within a broader bullish market structure.
Futures, Options & Perpetuals
Over the past week, BTC perpetual futures open interest increased by around 6.6k BTC, or approximately 1.4%, rising to roughly 468.5k BTC. This extends the rebuilding observed over recent weeks, although the pace of increase has slowed materially from last week. Perpetual positioning therefore continues to expand, but the latest move remains relatively modest.
By contrast, CME futures open interest declined by around 15.2k BTC over the week, representing one of the largest weekly contractions on record. Given the significant role of cash-and-carry strategies in CME positioning, a contraction of this magnitude is consistent with a meaningful unwinding of basis trades. The decline should therefore not be interpreted entirely as a directional reduction in institutional risk appetite. Nevertheless, CME exposure has contracted sharply at the same time that perpetual open interest has continued to rebuild, creating a clear divergence in positioning across the two futures markets.
Liquidations increased to approximately $3.1bn in combined long and short liquidations, up from around $2.8bn previously. Importantly, roughly $1.1bn of long positions were liquidated on 5 November alone.
Perpetual funding rates also increased modestly. Measured on a seven-day moving average, annualised funding ended the week at approximately 8.9%, up from around 8.3% previously. Funding therefore continues to point to a relatively firm long bias.
Across options markets, BTC open interest increased by around 55.8k BTC over the past week, or approximately 15.2%, rising from roughly 366.0k BTC to 421.8k BTC. This represents a substantial rebuilding following last week’s monthly expiry reset. Rebuilds of this kind are particularly useful because they provide a cleaner view of fresh positioning after a large block of legacy contracts has rolled off, capturing both the establishment of new directional positions and the reintroduction of hedging exposure. The latest increase therefore suggests that options activity is re-forming quickly following expiry rather than remaining subdued.
The put-to-call open interest ratio across major crypto-native exchanges also increased to approximately 0.70 from 0.68. Across IBIT options, the ratio remains extremely elevated at around 0.76, only modestly below last week’s 0.77 and still close to the upper end of its historical range. Both measures therefore continue to show a relatively defensive composition, with put positioning particularly concentrated within the ETF options complex.
The 25-delta skew curve continues to price a meaningful premium for downside protection, although the degree of defensive pricing has eased over the past week.
| Tenor | Current | 7-Day Change | 3-Year Percentile |
|---|---|---|---|
| 1w | +0.1173 | -0.0150 | 81st |
| 1m | +0.1085 | -0.0239 | 79th |
| 3m | +0.0801 | -0.0332 | 76th |
| 6m | +0.0597 | -0.0223 | 74th |
Skew has declined across every major maturity, with the largest reduction occurring at three months. However, all four tenors remain firmly positive and around or above the upper quartile of their respective three-year distributions.
Even following the post-expiry rebuild in options open interest, a clear defensive tilt remains evident. Put-to-call ratios across both crypto-native and IBIT options remain elevated, while positive skew continues to reflect a meaningful premium for downside protection across the curve.
Aggregate gamma remains positive, but only modestly so. The latest strike-level snapshot shows approximately +$6.5bn of positive gamma against -$5.3bn of negative gamma, leaving net exposure around +$1.2bn, down from approximately +$1.7bn last week. The overall dealer-hedging structure has therefore moved closer to neutral.
With Bitcoin near $75.8k, the largest nearby negative gamma concentration sits at $74k at approximately -$2.1bn. A move down through this region could cause dealer hedging to reinforce price movement rather than dampen it. By contrast, the largest positive concentration sits around $80k at approximately +$3.3bn, with a further +$0.8bn near $85k. A recovery towards these strikes could therefore produce more stabilising hedging flows and help dampen price swings as those levels become more relevant.
On balance, derivatives positioning remains notably divided. Perpetual open interest continues to rebuild and funding retains a firm long bias, despite another sizeable deleveraging event that included roughly $1.1bn of long liquidations in a single day. At the same time, CME open interest has contracted by 15.2k BTC in one of the largest weekly reductions on record. Options positioning has rebuilt rapidly following expiry, but elevated put-to-call ratios and persistently positive skew continue to reflect a defensive tilt. Aggregate gamma is now only modestly positive, leaving the dealer-hedging structure considerably closer to neutral and potentially increasing price sensitivity around nearby negative-gamma concentrations.
Bottom Line
- Performance: high 30-day correlations with equities left crypto assets exposed, as post-midterm fears of AI data-centre moratoriums drove further weakness. Even so, Bitcoin continues to trade within the $73–78k range we have identified as constructive for now. With 10-year yields declining and signs of seller exhaustion emerging, we view the longer-term set-up as constructive, although a sustained break below $73k or a further rise in equity correlation would weaken this view. The Chart of the Week also suggests Bitcoin’s apolitical character could prove a tailwind over a potentially tumultuous two years.
- Cryptoasset Sentiment Index: remained in negative territory throughout the week, recording levels as low as -0.72, which is almost one standard deviation lower than the average. This suggests that there could be further downside room to go.
- Chart-of-the-Week: underscores Bitcoin’s apolitical features. Annualised returns from 2013 to 2026 show no consistent partisan advantage across the Presidency, House or Senate: returns were higher under Democratic presidencies and Democratic Senate control, but also under Republican House control. This may be consistent with Bitcoin’s role as a global, decentralised and neutral asset, although the sample period is limited and past performance is not a reliable indicator of future results.
Appendix
except MSBT launched on the 08/04/2026
Data subject to change
*MSBT flows since 08/04/2026; all others since 11/01/2024
Data as of 05-11-2026
Combined positioning = futures and options in % of OI
Dispersion = (1 - Average Altcoin Correlation with Bitcoin)
Notes
[1] The Cryptoasset Sentiment Index is a composite indicator consisting of 15 different sub-indicators covering sentiment, on-chain, derivatives, flows developments as well as sentiment in traditional financial markets. A 90-day rolling z-score is used to standardise and aggregate these sub-indicators.
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