Huobi HTX Chief Analyst Andy: "Divided Congress" Should Not Be Overly Pessimistic; Midterm Elections Are Not the Core Variable for Crypto Market Trends

November 4 — The results of the 2026 U.S. midterm elections are largely clear: Democrats have retaken both the Senate and the House, putting the Trump administration into a "divided Congress" setup. Regarding the potential impact of this outcome on the crypto industry, Huobi HTX chief analyst Andy believes the biggest change is weakening expectations for regulatory legislation. The stablecoin bill that has already passed will not be easily reversed, and long-term trends such as stablecoin payments and RWA remain intact, but advancing market structure legislation such as the CLARITY Act will become noticeably more difficult. Over the next two years, the industry will rely more on administrative regulatory reform by the SEC and CFTC rather than congressional legislative breakthroughs. This means policy certainty for the crypto industry has declined somewhat, and some projects that depend on expectations of regulatory easing may face valuation adjustments.

At the market level, the short-term bias is bearish, but there is no need for excessive pessimism. On one hand, full Democratic control of Congress may limit Trump's ability to further expand fiscal stimulus, weighing on risk appetite for tech stocks and crypto assets; on the other hand, constrained fiscal expansion may also push U.S. Treasury yields lower, creating room for improved liquidity. The election result is not the core variable determining the direction of this market cycle. After political uncertainty is cleared, market focus will return to Federal Reserve policy, ETF fund flows, and U.S. equity trends. In the short term, watch for volatility and leveraged liquidations, while over the medium term, valuation repair driven by improved liquidity, as well as directions with real demand such as stablecoins and RWA, are worth watching.

Note: The content of this article is not investment advice and does not constitute an offer, solicitation of an offer, or recommendation for any investment product.