Cryptocurrencies rose on Wednesday after falling overnight following Democratic victories that gave the party control of both chambers of the US Congress. The election result raised concerns that efforts to ease regulation of digital assets could face delays, although some Democrats have also supported a lighter regulatory approach.

Bitcoin briefly fell to a six-week low before recovering. It was up 0.7% at $78,354 by 0841 GMT, alongside a rebound in US stock futures, which had dropped as much as 2% overnight before turning 0.3% higher. Ether gained 1.4% to $2,323. Solana, dogecoin and cardano rose between 1.6% and 2.2%.

The gains came amid a wider decline in crypto markets. Bitcoin has lost about 41% since reaching a record above $122,000 in October 2025, while the total value of the crypto market has fallen by roughly $300 billion over the past month to around $2.61 trillion, according to CoinMarketCap. Solana, dogecoin and cardano have each shed nearly a quarter of their value over the same period, according to CoinGecko.

Investor concerns about the outlook for AI returns and higher borrowing costs have also weighed on digital assets, prompting moves toward safer investments. LSEG/Lipper data showed investors withdrew $215 million from the largest bitcoin-backed exchange-traded funds in October, bringing outflows for the year to $1.84 billion.

Security concerns added to the pressure after a $6 billion hack of Binance last week. Bitcoin ETFs saw $884 million in net weekly outflows, their largest since early July, according to the data. Binance customers had withdrawn a net $4.72 billion from the exchange since it reopened over the weekend following the hack.

Tim Sun, a senior researcher at HashKey, said the security incidents had prompted investors to reassess crypto infrastructure and custody risks. He also warned that changes in the US political landscape could slow progress on crypto legislation and institutional frameworks.

The crypto industry spent more than $300 million backing candidates from both parties across the current and previous election cycles. President Donald Trump has advocated reduced regulation and, since returning to office, has introduced lighter enforcement and a strategic bitcoin reserve. The US has also eased access to banking and exchange-traded products and passed a federal stablecoin law.

Sources: Investing.com News.