Bitcoin recovered from overnight losses on Wednesday even as Democrats took control of both chambers of the US Congress, potentially slowing efforts to advance crypto-friendly legislation.

Bitcoin (CRYPTO: $BTC) briefly fell to a six-week low before rebounding 1.3% to $78,354. Ether (CRYPTO: $ETH) gained 1.4% to $2,323, while Solana (CRYPTO: $SOL), Dogecoin (CRYPTO: $DOGE) and Cardano (CRYPTO: $ADA) rose between 1.6% and 2.2%, according to market data.

The election results have raised concerns about the future of the crypto industry's regulatory agenda under President Donald Trump. Democrats gaining control of Congress could complicate efforts to pass legislation aimed at providing clearer rules for digital asset companies.

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The industry spent more than $300 million backing crypto-friendly candidates from both parties during the current and previous election cycles.

Last month, it was revealed that Fellowship PAC, a crypto-backed super PAC that previously praised Donald Trump and pledged a $100 million war chest, has shifted its political spending exclusively to Democratic candidates since June.

The group spent $600,000 supporting the reelection campaigns of Reps. Ritchie Torres and Maggie Goodlander, and Sen. Mark Warner.

Meanwhile, Bitcoin has lost around 41% since reaching a record above $122,000 in October 2025, while the broader cryptocurrency market has shed roughly $300 billion over the past month.

Investor confidence has also taken a hit following last week's $6 billion Binance hack, which triggered concerns about exchange security and custody risks. Customers withdrew a net $4.72 billion from the world's largest crypto exchange after it resumed operations over the weekend.

US spot Bitcoin ETFs recorded $884 million in net weekly outflows following the incident, while October withdrawals reached $215 million.