Key Insights Crypto market rebounds after the US midterm elections, with Bitcoin recovering towards $79,000, Ethereum trading near $2,292, and XRP around $1.27. Democrats win control of Congr
The crypto market started November 4 in a tricky position as it saw Bitcoin, Ethereum, and XRP try to bounce higher. However, there was a new twist in the political situation that many investors have been waiting on.
Bitcoin managed to bounce after dipping below $76,000 as early election results pointed to a Democratic sweep of Congress. Ether held near $2,300, and XRP was around $1.27.
However, as the US midterm election has come into play with Democrats securing control of the House and Senate, according to news coverage from Reuters and the Associated Press, it brings a new layer of uncertainty for crypto companies that were hoping for clearer federal regulations from a Republican controlled Congress.
The crypto market advanced with BTC price trading around $77,000 on Tuesday before falling sharply as election returns pointed toward Democratic gains.
However, as of Wednesday, Bitcoin was above $78,000. BTC recovered to approximately $78,450 after hitting a six-week low, and Ethereum was trading around $2,292, while XRP had gained about 1% to $1.27.
However, not everything was bouncing. There was some price disparity between the big names and the crypto market that remained sensitive to political sentiment and general risk.
Overall, the total crypto market cap was about $2.6 trillion in the supplied market snapshot. More recent market data placed it closer to $2.57 trillion.
Not all were positive in the price movement. Data from Farside Investors shows that the US spot Bitcoin ETFs experienced around $398.6 million in net outflows on November 2.
This is important, as the spot ETFs give traditional investors access to Bitcoin. However, sustained outflows show that demand for them is declining. However, this is only for one day, so we cannot get a true picture of the overall market.
Some ETFs experienced inflows while others experienced outflows, leaving a negative balance overall. This is important to note as there are multiple factors influencing the crypto market, and we should not look at ETFs as a true indicator of demand. However, the nearly $399 million withdrawn on Monday shows that institutional demand was not too great.
The overall sentiment in the market remains fragile. The crypto market Fear & Greed Index was down to 26 on November 3, according to Alternative.me.
This puts it into the fear zone. However, it managed to rise to 34 on November 4, which is still far from neutral. The index looks at several factors like volatility, momentum, volume, and social media.
For the crypto market, this is important. While Bitcoin may bounce after a huge dip, investors may not be confident enough to increase their exposure. The ETF outflows and low sentiment indicate there was still caution in the market.
The US midterm election results could cause issues for legislation. With Democrats controlling both Houses, it could make it harder for clearer crypto market regulation to be put in place.
There has been a lot of money spent in the industry to influence the political landscape.
Many companies and advocacy groups have supported certain candidates and campaigns to influence how responsibility will be distributed between federal regulators.
Crypto Market Rises After US Midterm Election | Source: X
Whilst it does not guarantee that any crypto bills will pass, there are still many factors to consider. However, having a change in control of Congress can influence what bills will be looked at.
According to the Associated Press coverage of the election and its projections for 2026 results, investors are worried that the result may cause delays to any pro-crypto legislation and deregulation.
The Coin Republic analysis on November 2 indicated that Bitcoin faces support at $77,345 and the next key resistance at $78,329.
Bitcoin Price Action | Source: TradingView
They also indicated that momentum was slowing with the daily RSI below 50. These levels are useful to know. However, they do not guarantee any change. Since then, Bitcoin has fallen below this support level as the market sold off due to the election.
They also looked at previous dips in Bitcoin around the US midterm elections. They indicated that there were cycle lows after the 2014, 2018, and 2022 elections.
Whilst this is interesting to note, it does not guarantee that the 2026 vote will have the same impact. These occurred in different economic and industry situations.
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