Cryptocurrencies recovered Wednesday after overnight losses as Democrats won control of both chambers of Congress, according to Reuters. The crypto industry has spent more than $300 million backing crypto-friendly Democratic and Republican politicians during the current and previous election cycles.

The industry has long pushed for faster deregulation of digital assets. While Republican President Donald Trump has been a high-profile advocate of a lighter regulatory approach, some Democrats have also supported similar policies.

Bitcoin briefly touched a six-week low before recovering to trade 0.7% higher at $78,354 as of 8:41 a.m. GMT. The rebound followed a reversal in the stock market, with U.S. index futures rising 0.3% after falling as much as 2% overnight. Ether gained 1.4% to $2,323.

Bitcoin has fallen about 41% since reaching record highs above $122,000 in October 2025, bringing the broader cryptocurrency market’s value to about $2.61 trillion, according to CoinMarketCap.

Smaller tokens, including solana, dogecoin and cardano, rose between 1.6% and 2.2% Wednesday. However, all three have lost nearly a quarter of their value over the past month, according to CoinGecko.

READ: FBI links $6.43 billion Binance crypto theft to North Korea-linked hacking group (November 2, 2026)

The recovery comes amid broader concerns about cybersecurity threats, artificial intelligence and the outlook for digital assets. The overall cryptocurrency market has lost about $300 billion in value over the past month as concerns about future AI returns and rising borrowing costs have pushed investors toward safer assets, including government bonds and major currencies.

Investors withdrew $215 million from the largest bitcoin-backed exchange-traded funds in October, bringing year-to-date outflows to $1.84 billion, according to LSEG/Lipper data.

A recent $6.3 billion cryptocurrency theft involving Binance has also hurt market sentiment. The incident triggered the largest net weekly outflow from bitcoin ETFs since early July, with withdrawals totaling $884 million, according to the data.

Binance said Thursday that $6.3 billion in digital assets had been affected in what is believed to be the largest cryptocurrency theft on record. The company said about half of the assets had been frozen, while the hackers retained control of the rest. Binance also pledged to “cover all losses.”
The theft has been linked to TraderTraitor, a North Korea-aligned hacking group.

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“The market may be re-evaluating the risk-reward profile of crypto assets. On one hand, the string of security incidents is forcing investors to re-examine the industry’s security infrastructure and custody risks,” Tim Sun, a senior researcher at HashKey, said.

“On the other hand, potential shifts in the U.S. political landscape could stall the progress of structural crypto legislation and institutional framework development. All of these factors leave the crypto market facing strong headwinds,” he added.

Trump pledged during his 2024 presidential campaign to make the United States the “crypto capital of the world.” He also launched his own meme coin and his family’s cryptocurrency platform, World Liberty Financial.

Since returning to office, Trump has pursued a lighter regulatory approach to the crypto industry and backed the creation of a strategic bitcoin reserve. His administration has also supported easier access to banking services and exchange-traded products for digital assets. Congress has passed a federal stablecoin law that could help bring these assets into mainstream payment and money-transfer systems.