U.S. Midterm Elections: Bullish or Bearish for Bitcoin?

Can Bitcoin recover to the $100,000 mark this year? The market views the upcoming U.S. Midterm Elections in November as a key trigger.

The midterms are general elections held at the midpoint of a president's four-year term. As of March, the first primaries are underway, and the crypto industry is pouring massive amounts of capital into congressional races across the country.

According to Federal Election Commission (FEC) data, crypto PACs, corporations, and investors have already spent $32 million to support pro-industry candidates and oppose detractors.

These elections are seen as an opportunity to solidify the achievements made during the Trump era and prevent a slide back into regulatory uncertainty. Regardless of President Trump’s pledge to make the U.S. the global crypto hub, it remains impossible without congressional approval. This is evident as the "Clarity" bill (Crypto Market Structure Bill), expected to facilitate institutional inflow, remains stalled in the Senate.

"The biggest legislative challenges in crypto history are at stake in these midterms. Securing crypto-friendly lawmakers is paramount," said Summer Mersinger, CEO of a U.S. blockchain association.

Since the Republican Party is generally more favorable toward crypto than the Democratic Party, most lobby funds are flowing toward GOP candidates. During the 2024 election, approximately two-thirds of crypto donations were used to support Republicans or oppose Democrats.

Currently, the House Financial Services Committee is chaired by crypto-advocate French Hill (R). If Democrats retake the House, Rep. Maxine Waters, a staunch critic, would likely take the chair. For the industry, control of Congress is the deciding variable for legislative success.

How did Bitcoin perform during past midterm years? Let's look at it alongside U.S. stocks.

• Stock Market: In midterm years, political uncertainty typically leads to a trend where the S&P 500 index drops by an average of 16% from peak to trough, making it the weakest year in the four-year presidential cycle. In 7 of the last 10 midterms, the decline exceeded 10%.

• Bitcoin: Tracking cycles since 2014, Bitcoin has shown a high correlation with the stock market, with an average decline of 56% during midterm years.

The Post-Election Turnaround Once election results are finalized and uncertainty is resolved, the market has historically shown strong rallies. The 12 months following a midterm election represent the strongest bull market in the cycle, with the S&P 500 recording an average return of 19%—never posting a negative return since 1939. Bitcoin also rose in all three cycles following midterms, with an average gain of 54%.

Conclusion If past patterns repeat, it may be difficult for Bitcoin to reclaim $100,000 this year. However, a full-scale bull market is projected for 2027 as political uncertainty clears.

By. Coinness