Bitcoin price rebounds above $77K as Democrats sweep U.S. midterms, what’s next?

Bitcoin has recovered above $77,000 after briefly falling toward $75,700 as Democratic gains in the U.S. midterm elections raised fresh questions about cryptocurrency regulation.

According to crypto.news price data, Bitcoin traded near $77,600 at the time of reporting, recovering from the earlier decline. The cryptocurrency had approached $78,000 late Tuesday before retreating as election results began arriving.

The recovery brought Bitcoin back into positive territory over the previous 24 hours, although the price remained below $80,000 and its October highs near $86,000.

Meanwhile, Ether traded near $2,300 during the subsequent recovery, while XRP approached $1.28. Solana recovered toward $93, and BNB traded near $700.

Elsewhere, U.S. stock futures and Asian equities weakened as investors assessed the election results and possible changes to economic policy.

Bitcoin price reacts to Democratic midterm gains

Democrats are projected to regain control of both chambers of Congress following Tuesday’s elections, reversing the Republican majorities established after the 2024 vote.

NBC News projected Democratic victories in the House and Senate, although several individual races remained undecided as counting continued Wednesday.

The election results brought renewed attention to the CLARITY Act, which seeks to establish federal rules for cryptocurrency trading and determine how digital assets are regulated.

The bill stalled in September after a Senate procedural vote failed to secure the 60 votes required to advance debate.

However, Democratic opposition has not been uniform. As previously reported by crypto.news, seven Democratic senators subsequently expressed interest in restarting negotiations.

Their objections included provisions concerning political officials’ cryptocurrency interests and the division of regulatory responsibilities.

Industry groups had spent heavily before the election. An October campaign-finance review found approximately $176 million in crypto-linked political spending across more than 100 races.

Stand With Crypto separately endorsed 45 candidates in its campaign to support digital asset legislation.

Bitcoin sentiment weakens as ETF outflows continue

Retail cryptocurrency sentiment deteriorated during the election count, according to blockchain analytics firm Santiment.

In a November 4 update, Santiment said Bitcoin’s bullish-to-bearish commentary ratio had fallen to approximately 0.51.

On October 20, the platform recorded roughly 1.8 positive Bitcoin comments for every negative comment. Sentiment subsequently weakened following the October Binance security breach.

The ratio briefly reached 0.37 before recovering and turning negative again during the midterm election results.

Santiment suggested that “sell the rumor, buy the news” behavior could emerge once election projections become clearer, although such a reversal remains uncertain.

Institutional demand has faced pressure as well.

U.S. spot Bitcoin ETFs recorded $115.56 million in net outflows on November 3, following withdrawals of $398.6 million on November 2 and $643.3 million on October 30, per SoSoValue.

The earlier Bitcoin price decline coincided with withdrawals from investment funds, leveraged liquidations and weakness in technology stocks.

BlackRock’s IBIT accounted for $405.3 million in withdrawals on November 2, while inflows into other funds partly offset the losses.

Bitcoin price prediction: can BTC reclaim $80,000?

Bitcoin’s recovery has brought several technical resistance levels back into focus, although momentum indicators continue to show weakness.

The supplied daily chart placed Bitcoin’s Relative Strength Index at 39.87, below the neutral level of 50. Its moving average stood at 40.74.

Meanwhile, the Moving Average Convergence Divergence remained negative, with the MACD line at -1,293.01 and its signal line at -955.85.

The histogram stood at -337.16, although its shortening negative bars suggested that selling momentum had begun easing.

Crypto analyst Rekt Capital warned on X that Bitcoin was facing rejection near two immediate three-day resistance levels.

He said continued rejection could produce another lower high and eventually direct prices toward $75,500.

Ted, another market analyst, pointed to Bitcoin’s previous corrections during midterm election periods.

He suggested another decline was possible but “not to a new cycle low,” distinguishing his outlook from predictions of a deeper market downturn.

More Crypto Online maintained that the current pullback could remain corrective, with a possible medium-term recovery.

However, the analyst said “there is no signal yet that the low is in,” leaving room for further weakness.

For the immediate Bitcoin price outlook, $78,000 remains the first resistance area, followed by $79,000 and $80,000.

Below current prices, traders are monitoring $76,500, followed by $75,500 and the recent low near $75,700.

Bitcoin futures funding reaches two-month high

Derivatives activity offered a different picture of investor positioning despite the negative sentiment recorded on social media.

In a CryptoQuant analysis, analyst Arab Chain reported that Binance’s Bitcoin futures funding rate had reached its highest level in more than two months.

The reading stood at 0.01, compared with a 30-day moving average near 0.004557.

Positive funding indicates that traders holding long positions are paying those holding short positions, suggesting stronger demand for bullish leveraged exposure.

Arab Chain warned that growing long exposure could create liquidation risks if Bitcoin prices declined suddenly.

The analyst recorded the funding increase while Bitcoin traded around $77,000.