Crypto market dips as U.S. midterm results and Binance hack weigh on sentiment

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Crypto market dips on US midterms, Binance hack

Highlights

Cryptocurrencies briefly fall as Democrats win both U.S. Senate and House, stalling expectations for faster deregulatory crypto legislation.
Bitcoin touches six-week low and trades around $78,070 after Binance suffers a record $6 billion hack, prompting $4.72 billion in net customer withdrawals.
Crypto market capitalization drops $300 billion in the last month to $2.61 billion amid weaker risk appetite and shifting U.S. political outlook.

Market reaction and policy concerns

As reported by Reuters, cryptocurrencies briefly fall on Wednesday after Democrats win majorities in both the Senate and House in the U.S., a result that the industry sees as a potential setback to faster deregulation of digital assets.

The sector spends more than $300 million backing crypto-friendly Democrats and Republicans in roughly equal measure during the current and previous election cycles, seeking legislation that U.S. crypto companies say would give them firmer legal footing and support growth.

Bitcoin briefly touches a six-week low before recovering to trade roughly flat by 0715 GMT at $78,070. Ether trades at $2,292, up 1%.

Trump, who vows during his 2024 presidential campaign to make the United States the "crypto capital of the world," also makes his own moves into digital assets, including the launch of his "Trump" meme coin and his family's World Liberty Financial crypto platform.

The sector sees sweeping reforms in the almost two years since Trump returns to office, including lighter enforcement and the creation of a strategic bitcoin reserve. Washington also allows easier access to banking and exchange-traded products and passes a federal stablecoin law that could help these assets move further into mainstream payments and money transfer systems.

Security breach and broader market losses

Beyond the election outcome, the market remains under pressure from weaker risk appetite and the fallout from last week's $6 billion hack of Binance, the largest heist in history. On Tuesday, Binance customers withdraw a net $4.72 billion from the world's largest cryptocurrency exchange since it reopens following the hack at the weekend.

Bitcoin has fallen about 41% from record highs above $122,000 in October 2025, while the broader crypto market's value stands at around $2.61 billion, according to CoinMarketCap. The market loses about $300 billion in the last month alone as concern over future returns from AI and the strain of rising borrowing costs push investors toward government bonds and safe-haven currencies.

Tim Sun, senior researcher at HashKey, says investors may be re-evaluating the risk-reward profile of crypto assets as repeated security incidents force a closer look at custody risks and industry infrastructure. He adds that possible shifts in the U.S. political landscape could stall structural crypto legislation and institutional framework development, leaving the market facing strong headwinds.

In our earlier article on CTOS Digital’s cybersecurity breach and its financial impact, we covered the company’s estimate that the incident could cut profit after tax by RM12 million and revenue by RM16 million if some services stayed disrupted until the third week of October. We also noted that each additional week of disruption could further weigh on earnings, as the firm worked to restore operations and rebuild customer confidence.

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