Bitcoin and the S&P 500 could post significant gains during the 12 months following the U.S. midterm elections on November 3, based on historical market trends. However, Bitcoin’s previous rallies may have been driven more by its four-year halving cycle than by political developments.
Since Bitcoin launched in 2009, the cryptocurrency has experienced four U.S. midterm election cycles. Excluding 2010, when the digital asset market was still in its early stages, Bitcoin recorded an average return of 53.7% in the year following the other three elections, according to data analyzed by CoinDesk.
The calculation measures the percentage change between Bitcoin’s daily closing price at 00:00 UTC on Election Day and its closing price on the same date one year later.
Bitcoin gained an extraordinary 1,579% in the 12 months following the 2010 midterms. However, the cryptocurrency market was extremely small at the time, making that performance an unreliable benchmark for current market conditions.
If the historical pattern continues, Bitcoin’s recent consolidation near $80,000 could precede another rally after the November 3 elections. BTC has already recovered more than 35% since falling below $60,000 in June. Some market analysts believe the cryptocurrency may be entering another bullish phase, potentially creating an opportunity for investors seeking long-term exposure.
Bitcoin’s four-year cycle may explain post-election rallies
Although historical returns appear favorable, the limited number of observations makes it difficult to establish a direct connection between midterm elections and Bitcoin’s performance. The cryptocurrency’s established four-year market cycle could offer another explanation for its previous recoveries.
Bitcoin’s market cycle is closely associated with its programmed halving events, which occur approximately every four years. Each halving reduces the amount of new BTC awarded to miners for validating a block by 50%.
Historically, Bitcoin has rallied sharply following each of its four completed halvings, reached a peak approximately 12 to 18 months later and subsequently entered a prolonged downturn.
These bear markets coincided with U.S. midterm election years in 2014, 2018 and 2022, as well as 2026. This timing suggests that previous post-election recoveries may have marked the beginning of new Bitcoin market cycles rather than resulted directly from political changes.
S&P 500 history supports a bullish outlook
The S&P 500 has a considerably longer historical record, and its performance also points to stronger returns in the year following U.S. midterm elections.
Data from Hartford Funds shows that the benchmark index has delivered an average gain of 15.17% during the 12 months after midterm elections since 1950. By comparison, its average return during other years was 7.30%.
This historical difference suggests that the post-election period has generally been favorable for U.S. equities. A sustained stock market rally could also support Bitcoin and other risk-sensitive assets, although their performance is not guaranteed to follow the same pattern.
Political uncertainty could shape the next market phase
The November 2026 elections could influence President Donald Trump’s policy agenda during the final two years of his current White House term.
If Democrats take control of either chamber of Congress or both, disputes over the federal government’s growing debt burden could intensify. Negotiations surrounding the unresolved debt limit could become more complicated, while Trump’s proposed $350 billion in mandatory defense funding could encounter resistance, according to Brookings.
Democrats could also use congressional oversight and legislative restrictions to challenge funding for further military escalation in the Middle East.
Cryptocurrency policy may become another source of political conflict. Democratic committee chairs could investigate potential conflicts of interest involving Trump’s personal crypto-related profits and his family’s business activities. Democratic lawmakers have already sent oversight letters concerning those connections.
Trump’s memecoin, launched in January 2025, has also faced criticism after retail investors experienced substantial losses.
However, the Supreme Court’s ruling in Trump v. Slaughter left much of the financial regulatory structure under presidential control. This could limit Congress’s ability to prevent the administration from advancing its crypto-friendly policies.
Financial markets have largely factored in the possibility of a divided government, with Democrats expected to regain control of at least one chamber of Congress.
Overall, historical trends offer a potentially positive outlook for Bitcoin and the S&P 500 after the midterms. Still, whether the next rally materializes will depend on a combination of political developments, Bitcoin’s market cycle and broader economic conditions rather than election history alone.
