Bitcoin experienced a volatile session after the US midterm elections, initially dropping to its lowest level in almost seven weeks at around $75,600 before rebounding to just over $78,000 as of press time. The sharp sell-off proved short-lived as political uncertainty eased and buyers stepped back in.
Democratic Sweep Weighs on Risk Assets
Democrats won control of both the House and the Senate in Tuesday’s midterm elections, giving President Donald Trump a divided government for the final two years of his term. The outcome included flips in several traditionally Republican states and majorities in both chambers.
Bitcoin was rejected at $77,000 and tumbled to its lowest level since September 17 at $75,600. The decline was not isolated: Nasdaq 100 futures also plunged in the early election reaction, while the dollar weakened and Treasury yields fell.
The concern for crypto is that Democratic control of Congress could complicate parts of the Trump administration’s pro-industry legislative agenda and increase scrutiny of areas such as technology and financial regulation. At the same time, the political outcome is likely to create gridlock because Trump retains veto power over legislation passed by Congress.
The initial fear quickly faded, with the largest cryptocurrency erasing most of its losses and jumping to just over $78,000. According to market commentators, the political outcome reduced uncertainty, while significant call-option buying emerged during the rebound.
Local Bottom Found?
Crypto analyst Bren believes BTC might revisit the $56,000 bear-market low, while Ali Martinez shared a contrasting view. Martinez highlighted bitcoin’s short-term holder realized price, which currently sits around $75,800, indicating that the latest leg down brought the asset almost directly into that zone.
Such tests during previous uptrends have historically coincided with local bottoms, Martinez added. In March 2023, bitcoin bottomed at $20,000 while the metric stood at $19,800. Similar behavior was seen in June 2023 and May 2024 before the cryptocurrency jumped higher.
Lacie Zhang, Research Lead at Bitget Wallet, offered a similarly constructive assessment in comments sent to CryptoPotato: “Bitcoin has fully erased its early-session decline and is trading near $77,000, up roughly 1.8% over the past 24 hours after holding above the $75,700–$76,000 support zone. The recovery suggests spot demand has been sufficient to absorb residual selling pressure from recent liquidations and ETF outflows, helping Bitcoin stabilize after the latest bout of volatility.”
Zhang added that the broader trend remains consolidative below key resistance at $80,000, but BTC needs to reclaim that level for the market to flip constructive and bullish again.
