Offchain: Democrats take Congress as Bitcoin slides to an 11-week low

The US midterms handed Democrats control of both houses of Congress, and with them the committees that oversee crypto. Bitcoin squeezed above $81,000 on the result, then sank to its lowest price since August as tech stocks tumbled and a strong jobs report revived talk of a December rate hike.

Meanwhile, Binance is getting back on its feet after last week’s record hack.

Here are the top stories you need to know:

Headlines of the week

• Bitcoin fell about 2% this week, squeezing up to $81,130 on Wednesday before sliding to $74,780 on Friday, its lowest price since 21st August.
• US spot Bitcoin ETFs lost $1.28bn between 2nd and 6th November, with BlackRock’s IBIT accounting for $1.21bn of it. Ethereum ETFs lost another $365.3m.
• Trump Media moved 4,259 BTC to Crypto.com, worth around $344m, from wallets labelled “2028 Convertible Notes Collateral”. Holders of those roughly $1bn in notes can demand cash from 30th November. The timing is hard to miss.
• Russians can buy Bitcoin from 17th November, but only up to 300,000 roubles (about $3,700) a year per broker, and only after passing a test. Ether and USDT are on the menu too.
• Zcash’s NU7 upgrade went live on 6th November, cutting block times from 75 seconds to 25. Three times faster, same privacy.

Crypto’s $170m midterm bet falls short

Democrats won control of both the House and the Senate in the US midterms on 3rd November, despite crypto-linked groups spending more than $170m on the election. The biggest upset for the industry came in Ohio, where Democrat Sherrod Brown won the special Senate election after more than $64m in crypto-related spending, including a $30m campaign against him from the Fairshake super PAC.

That matters, because the committees that oversee crypto will change hands in January. Senator Elizabeth Warren, one of crypto’s fiercest critics, is expected to chair the Senate Banking Committee, while Maxine Waters is set to lead the House Banking Committee. The CLARITY Act, which would set clear rules for crypto markets, stalled in a 49 to 50 Senate vote in September and will expire on 3rd January unless it passes in the next few weeks.

Markets took the result in their stride, at first. Bitcoin dipped to $75,600 on election night, then jumped to $81,130 on Wednesday as traders betting on a fall were forced to buy back in, with around $560m of short positions liquidated in 24 hours. The mood in Washington is less friendly, though. Robert Garcia, the Democrat expected to lead the House Oversight Committee, posted a two-word message for the industry on X: “LAWYER UP”.

Bitcoin gets dragged down with tech

Bitcoin’s post-election rally lasted about a day. On Thursday, a sharp sell-off in AI and chip stocks sent the Nasdaq down 5.52%, its worst session in 19 months, with Nvidia falling more than 9%. Part of the worry was that a Democratic Congress could bring tougher AI rules and slow down data centre building.

Crypto followed. Bitcoin gave up all of its post-election gains, and more than $1bn in leveraged positions were wiped out in a day. Then on Friday, the US jobs report showed 165,000 new jobs in October, against forecasts of around 65,000, and unemployment fell to 4.1%.

Strong jobs data gives the Fed more reason to raise rates, and CME FedWatch odds of a December hike rose from 66.9% to 76.8%. Bitcoin fell as low as $74,780, its lowest price since 21st August. For now, it’s trading like a tech stock again, for better and for worse.

Binance reopens, and most users stay

A week after the biggest hack in crypto history, Binance is getting back to business. Withdrawals reopened on 1st November, and in the first nine and a half hours, users pulled out $4.65bn while depositing $1.01bn. Binance put the net outflow at around 2.1% of its $171bn in assets.

CZ was quick to put a positive spin on it, posting that “98% choose to stay!” But not everyone is convinced. DefiLlama data shows the assets it tracks on Binance fell by more than $16.5bn between 29th October and 2nd November, although falling prices account for part of that.

Binance says it has now replaced around 98% of the stolen funds and is buying back the less liquid tokens that make up the rest. Its latest proof of reserves, taken on 4th November, covers 44 tokens, up from 10 in the first snapshot after the hack. Withdrawals are coming back in stages, network by network.

Final takeaway: Crypto’s allies are about to lose control of Congress, Bitcoin is trading like a tech stock again, and Binance is slowly getting back on its feet.

Caleb for CoinJar

Ethereum’s Corrective Phase Approaches High Time Frame Support

Ethereum price action remains in a corrective phase, with price currently moving towards high time frame support situated at $1,977. This region may determine whether the current correction stabilises or extends further to the downside.

Looking at the price structure, a previous single-print candle remains visible on the left side of the chart. These candles are typically formed through strong directional moves that leave limited price acceptance, often creating areas that may be revisited and filled during subsequent corrections. Ethereum is currently moving through this region, suggesting that the market is working to fill the remaining imbalance.

If the $1,977 support holds, it opens the possibility of a recovery towards high time frame resistance at $2,215. However, any potential rotation higher would need to be supported by renewed bullish volume and buying pressure to demonstrate sufficient demand.

Overall, Ethereum remains positioned between two significant high time frame levels, with the current corrective phase still underway. Holding $1,977 could provide the foundation for a move towards $2,215, while a sustained loss of support would increase the risk of further downside and a deeper correction.

Aziz for CoinJar

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