Bitcoin Hovers Below $78,000 After Democrats Win Control of Congress
By Joseph WilkinsBitcoin traded just below the $78,000 level on Wednesday as traders assessed a stunning Democratic win in the U.S. midterm elections.The bellwether cryptocurrency was up 0.1% at $77,910 immediately after the Democrats won control of the Senate and the House, in a rebuke to President Trump's second term.Crypto assets are struggling for direction after being caught between prospects for falling tech stocks--often negative for bitcoin--and a weaker dollar, which tends to lend a boost.The most significant reaction in financial markets to the emerging blue wave in the midterm elections is expected in tech-sensitive shares. Traders are concerned about a growing backlash toward the construction of artificial-intelligence data centers, while the sector is likely to face greater regulation.Regulation is also a point of contention for the crypto industry under the Democrats. A blue victory could spur a negative reaction on perceptions of tougher or slower digital-asset regulation, crypto analysts said."The regulators are currently giving the guidance as they see it and how they're going to enforce it, but there is a risk that a future administration can say, 'No, that interpretation was wrong, we're going to change it, and you can't do these things anymore,'" said Stephen Coltman, head of macro at crypto exchange-traded product provider 21Shares.Still, the macro backdrop remains delicate, with U.S. economic data landing later this week potentially holding more sway on the direction of travel for bitcoin in the short term.Renewed escalation in the Middle East revives concerns about energy prices and inflation, pushing yields higher and pressuring risk assets that include cryptocurrencies, said Firas Bechwaty at ICM MENA.Ether was 0.1% higher at $2,294.85.Write to Joseph Wilkins at [email protected]