Original | Odaily Planet Daily (@OdailyChina)
Author | Wenser (@wenser 2010 )
With one week to go until the US midterm elections on November 3, the crypto market has already begun pricing in the House and Senate voting results between the Democratic and Republican parties. At present, based on comprehensive predictions from forecasting market platforms such as Kalshi and Polymarket as well as some polling models, there is little suspense that the Democratic Party will win a majority of House seats, but for the Republican Party, there is still some room for maneuver in Senate seats.
At the same time, Trump's approval rating has rebounded slightly from its historic low, rising slightly to 32% this morning. Previously, media reports said that Trump had spent a cumulative $280 million on this midterm election in an uphill sprint; in September this year, for the sake of smooth midterm elections, Trump even declared that "if the Republican Party wins, every American adult citizen will be provided with $5,000," calling it the "Trump dividend."
This midterm election involves not only Trump's political career, but will also determine, for a considerable period thereafter, the direction of crypto policy related to the US SEC and CFTC, and even the market performance of assets such as cryptocurrencies and US stocks. Odaily Planet Daily will briefly discuss the related issues.
Midterm Election Preview: Trump's Approval Rating Remains Between 30% and 40%
As the US midterm elections enter their final week, the latest polls show that Trump's approval rating has risen slightly by 1% from last week's historic low to 32%, while the Democratic Party leads the Republican Party by 11% in national congressional election support.
A poll completed by Reuters and Ipsos on October 26 showed that 47% of registered voters said they would support the Democratic Party in the November 3 midterm elections, 36% supported the Republican Party, and another 11% had not yet decided. The Democratic Party's lead narrowed by 1% compared with last week. If the leanings of undecided voters are included, Democratic support is 50% and Republican support is 41%, narrowing the gap to 9%. Among those voters most likely to vote, the Democratic Party also leads 53% to 44%.
At present, the Republican Party controls both the Senate and the House and is striving to retain its majority seats. And the reason the midterm elections are important is that if the Republican Party loses control of either chamber, Trump's policy agenda in the last two years of his second term may be obstructed, especially regarding crypto-friendly regulatory policies as well as allegations related to presidential immunity and the boundaries of profiting from cryptocurrencies.
The following is comprehensive data from multiple US media outlets and polling institutions. Trump's approval rating has basically remained above 32%, with a net value of -19% to -27%, significantly worse than the same period in Trump's first term (October 2018 net value of -11.7).
Poliwave, FiftyPlusOne, PollResults
Quick Overview of Senate and House Races: Democrats Need Only 3 Seats in the House, and a Net Gain of 4 Seats in the Senate
According to Inside Elections data as of October 15, in the House, the Republican Party currently holds the majority with 220 seats to 215, and the Democratic Party needs a net gain of 3 seats to achieve a majority; in the Senate, the Republican Party holds the majority with 53 seats to 47, and the Democratic Party needs a net gain of 4 seats. If it becomes 50 to 50, Vice President Vance would cast the vote, which means the Republican Party would still have the final say.
Prediction Markets Price the Midterm Elections: Democrats' Chance of Winning the House Exceeds 90%, While Their Chance of Winning the Senate Is Mostly Below 70%
Thanks to a series of glorious track records such as successfully predicting Trump's victory in the US presidential election, prediction market platforms are another hot focus of attention besides the media, polls, academic institutions, and various models.
As of the time of writing, the probability on Polymarket of the Democratic Party winning the House has soared to 92%, with an estimate that the Democratic Party will win 236 of the 435 seats; at the same time, the platform predicts the Democratic Party's probability of winning the Senate at 67%, with an estimate that the Democratic Party will win 52 seats.
The relevant data from Kalshi, also a prediction market platform, is roughly the same: it predicts that the Democratic Party will win the House majority with 234 seats and a 91% probability; but the platform predicts the Democratic Party's probability of winning the Senate majority at 64%, and the specific number of seats is likewise 52.
In addition, Silver Bulletin (Nate Silver model) predicts a 92% probability that the Democrats take the House; the probability of taking the Senate is 76%; the academic model data tracked by DeLuca of Yale University's Political Science Academy gives more varied predictions: the probability of the Democrats taking the House is as high as 95% and as low as 68%; the probability of winning a Senate majority is as low as 37% and as high as 69%.
Back to prediction markets, the data from combination markets may be more intriguing: in Polymarket's two-chamber combination event, the probability of the Democrats taking both chambers is 66%, the probability of a Democratic House and Republican Senate is 27%, while the probability of the Republicans holding both chambers is only 8% (Polymarket).
The Direction of the Crypto Market and US Stocks All Hinges on Trump: US Stocks May Continue to Fluctuate, Crypto May Suffer Short-Term Setbacks
Having covered the forward-looking data and predictions of election trends, let's talk about the potential subsequent impacts.
US Stocks: If the Democrats Take Both Chambers, Crypto-Related Stocks and AI Stocks May Face Pressure and Fluctuations
For US stocks, the main impact of the midterm elections lies in "tariffs, taxes, and regulation" within the scope of the executive branch's influence. A research report released by Morgan Stanley on October 14 pointed out that these aspects are mostly driven by the executive branch, and changes in the congressional majority have little impact; after the House and Senate majorities are split between the Democratic and Republican parties, congressional investigations and budget tug-of-wars may intensify.
But historical data shows that in the second year of midterm elections when the president is a Republican and Congress is divided, the S&P 500 has on average performed most strongly, with gains of 23%; while when the president is a Republican and Congress is controlled by the Democrats, the average gain in the year following the midterm elections is 15%.
In addition, a report released by Citibank in early October pointed out that the temporary funding expires on December 11; if the Democrats take the House, they may subsequently make demands on the budget, and risks such as last year's government shutdown still exist.
Specifically for US stock sectors, if the Democrats sweep both chambers, affected by news such as the stalling of the CLARITY Act and restrictions on the advancement of subsequent crypto-friendly regulatory policies, crypto-related stocks may suffer short-term setbacks; the AI sector will also be negatively affected, various data centers that are "rushing to build" are expected to be affected to some extent, and Anthropic's IPO sentiment may also take a short-term hit; although it will not affect the industry's development trend, short-term fluctuations are unavoidable.
The related reasons are as follows: if the Democrats achieve better-than-expected victories in congressional and state-level elections, policy uncertainty surrounding data center construction, artificial intelligence regulation, and taxation of technology companies may further hit AI industry chain stocks; Wall Street financial institutions, crypto companies, and related regulatory agencies will also face more scrutiny.
As for the cryptocurrency market, it currently appears that its interests are deeply bound to the Republican Party; if the Republican Party loses its majority in both chambers, it may face short-term setbacks.
Crypto Market: If the Republicans Hold Both Chambers, CLARITY, Major Coins, and Crypto-Related Stocks Will All See Short-Term Sharp Rallies
According to The Washington Post, in the 2026 midterm election cycle, the top 50 donors have cumulatively invested funds that have grown to $2.77 billion, of which about $1.67 billion is related to donations to the Republican camp, about $832 million to the Democratic camp, and about $264 million to special interest groups.
Among individual donors, Musk ranks first with about $446 million, also setting a record for the largest individual political donor in modern American history, with funds mainly flowing to super PACs and related organizations supporting Republican candidates. (Odaily Planet Daily note: on October 13, this figure was still about $276 million)
Among crypto industry donors, Coinbase ranks 5th among donating organizations and 12th on the overall list with about $57.8 million; Ripple donated about $49.6 million, ranking 7th among donating organizations and 17th on the overall list; Gemini founders Cameron and Tyler Winklevoss donated a combined total of about $55.9 million, ranking 13th on the overall list; Foris Dax ranks 24th on the overall list with $39 million. It is worth mentioning that, apart from Coinbase and Ripple, which donated in the name of special interest groups, all other parties are Republican donors.
If the Democrats take both chambers, CLARITY legislation will be further delayed, and regulation-sensitive altcoins, DeFi, and crypto-related stocks may see short-term declines, while Bitcoin's decline may be limited;
If the Democrats take the House and the Republicans the Senate, a slowdown in legislative pace and stricter regulatory scrutiny may become inevitable, but the crypto market has already priced this in in advance, and volatility will instead be smaller;
The most ideal situation is naturally for the Republicans to hold both chambers, after which the CLARITY Act is expected to restart, and ETH, SOL, DeFi, and crypto-related stocks will most likely see a wave of sharp rallies.
Of course, based on the current situation, the first possibility is greater, the second is next, and crypto industry participants need to be mentally prepared and manage risk.
