Bitcoin briefly touched its lowest level in six weeks before trading 0.7% higher at $78,354 by 0841 GMT, according to Reuters. Ether gained 1.4% to $2,323, while several smaller tokens also advanced. The recovery followed an initial sell-off after Democrats won control of both chambers of the US Congress in the midterm elections.
The result has implications for an industry that has invested heavily in influencing US policy. Crypto companies and supporters spent more than $300 million backing candidates from both parties during the current and previous election cycles, seeking legislation that would provide clearer rules for digital assets and support wider institutional participation.
Democratic control of Congress could increase scrutiny of the sector and complicate efforts to advance legislation favoured by the industry. The political shift comes after the Trump administration adopted a more permissive approach to digital assets, including measures to improve access to banking and exchange-traded products and the creation of a strategic bitcoin reserve.
Security concerns have added to the pressure. A $6 billion hack involving Binance last week unsettled investors and prompted substantial withdrawals from the world's largest cryptocurrency exchange. Customers had withdrawn a net $4.72 billion by Tuesday after the platform reopened following a temporary suspension of withdrawals, Reuters reported.
The incident has renewed questions about custody arrangements, exchange resilience and the protection of customer assets. It has also contributed to wider weakness in the sector: the overall cryptocurrency market lost about $300 billion in value over the preceding month, while investors withdrew money from bitcoin-backed exchange-traded funds.
The latest price recovery therefore does not yet indicate a broad improvement in confidence. Bitcoin remained far below its record high above $122,000 reached in October 2025, and the market continues to face pressure from higher borrowing costs and doubts about the returns from AI-related investment competing for capital.
For digital-asset businesses, the immediate challenge is to rebuild confidence in security while navigating a potentially more demanding regulatory environment. Market direction will depend not only on political developments but also on whether trading platforms can demonstrate stronger safeguards and reliable access to customer funds.
