Cripto-T

Following the 2024 elections, in which an estimated 270 lawmakers with favorable views on digital assets won seats in the US Congress, many cryptocurrency-affiliated organizations and political action committees show no signs of slowing their progress in the next significant election, the 2026 midterms.

Likely boosted by advocacy work from organizations — such as the Coinbase-affiliated Stand With Crypto group and whose campaigns were supported by media buys from political action committees (PACs) — a majority of lawmakers in the 119th session of the US Congress took office in January having already expressed views signaling that they would support pro-crypto legislation and policies. 

In the last year, some of Congress’s work supported that theory. The US House of Representatives passed three significant bills in July as part of the Republicans’ “Crypto Week” initiative.

One of these bills, the GENIUS Act stablecoin payments legislation, was signed into law by US President Donald Trump almost immediately. The other two bills, focused on digital asset market structure and anti-Central Bank Digital Currency (CBDC) policies, await consideration in the Senate as of December.

Amid consideration of these bills, PACs like Fairshake, one of the significant crypto-backed spenders in the 2024 elections, continued to support candidates in 2025 races.

Media buys by the PAC and its affiliates included $1 million for Democratic candidate James Walkinshaw in a special election for Virginia’s 11th congressional district seat and $1.5 million for two Republican candidates in two special elections for Florida congressional seats.

“We are keeping our foot on the gas,” Fairshake spokesperson Josh Vlasto told Cointelegraph in January. “With the midterms on the horizon, we are poised to continue backing candidates committed to advancing innovation, growing jobs, and enacting thoughtful, responsible regulation and opposing those who play politics and stand in the way with the voters’ support for crypto.”

What’s at stake for the crypto industry in 2026?

In November 2026, votes will determine which candidates will fill all 435 seats in the House, as well as 33 seats in the Senate. Republicans have held a majority in Congress since January, essentially allowing them to enact their agenda at the direction of Trump on matters such as digital assets.

The presidency will not come up for election until 2028, meaning that even if Democrats secure a majority in one or both chambers of Congress in 2026, they could still face opposition from a Republican-controlled White House for two years. Trump would still have the ability to veto some Democrat-led legislation.

Fairshake reported holding $141 million ahead of the midterm elections, backed by contributions from cryptocurrency companies including Ripple Labs and Coinbase. Stand With Crypto said in November that it had shared a questionnaire with candidates in state and federal races to gather their views on digital assets on the record for potential voters.

As of the time of publication, however, it’s still too early to determine whether the industry could once again sway voters’ opinions and influence elections.

One of the biggest upsets in 2024 included Republican Bernie Moreno’s victory over Democratic incumbent Sherrod Brown for the US Senate in Ohio. Moreno received $40 million from crypto-backed lobbyists.

However, some crypto-aligned candidates lost their elections or primaries in 2024. John Deaton, a lawyer who advocated for XRP (XRP) holders in court, lost to Senator Elizabeth Warren by about 700,000 votes in Massachusetts.

Magazine: 2026 is the year of pragmatic privacy in crypto: Canton, Zcash and more

According to Cointelegraph, the Federal Reserve's approach to interest rate cuts in 2026 is expected to play a crucial role in determining the return of retail investors to the cryptocurrency market. A crypto analyst suggests that the Fed's decisions will significantly impact investor sentiment next year, especially after three rate reductions were already implemented in 2025.Clear Street's managing director, Owen Lau, emphasized to CNBC that the Fed's rate decisions are pivotal for the crypto sector in 2026. Lau noted that both retail and institutional investors could become more enthusiastic about entering the crypto market if the Fed continues to cut rates. Typically, interest rate cuts are seen as favorable for crypto assets, as they make traditional investments like bonds and term deposits less appealing, prompting investors to seek higher returns in riskier assets such as Bitcoin (BTC) and other cryptocurrencies.The Federal Reserve's December minutes, released on Tuesday, reveal that the central bank is open to adjusting rates next year to meet broader economic objectives. The minutes stated that the Committee is prepared to modify monetary policy if risks arise that could hinder the achievement of its goals. However, there is skepticism in the market about whether the Fed will continue with rate cuts in the early months of the year, as indicated by data from the crypto prediction platform Polymarket.Polymarket's data shows a mere 15% probability of a rate cut in January, while the likelihood increases to 52% for a rate cut in March. In 2025, the Fed executed three rate cuts, with the first being a 25 basis point reduction in September. This was followed by another 25 basis point cut in October and a further 25 basis point cut in December. Despite these cuts, the minutes revealed a division among Fed members regarding the necessity of the December reduction.Bitcoin experienced a surge to a new high of $125,100 following the initial rate cut in September. However, this uptrend was short-lived due to a significant liquidation event on October 10, which resulted in $19 billion being wiped out from leveraged positions. Currently, Bitcoin is trading at $88,439, down 29.3% from its October peak, as reported by CoinMarketCap. The broader crypto market sentiment has also declined, with the Crypto Fear & Greed Index remaining in the 'Extreme Fear' territory since December 13, posting a score of 23 on Wednesday.

According to ChainCatcher, data from Coinglass indicates that if Ethereum's price falls below $2,829, the liquidation intensity for long positions across major centralized exchanges could reach $1.493 billion. Conversely, if Ethereum surpasses $3,121, the liquidation intensity for short positions could amount to $547 million.