The new report published by Binance Research points to the potential of the upcoming 2026 US midterm elections to spark a recovery process for both Bitcoin and stocks. The report states that although geopolitical tensions and rising energy costs continue to put pressure on the markets, there were strong rallies in risky assets after the election, based on historical data.
Market Movements in Past Midterm Election Years
According to analysis by Binance Research, the S&P 500 index returned an average of 19 percent in the 12 months following the US midterm elections, and a negative annual return has not been recorded since 1939. The report stated that Bitcoin has experienced an average increase of 54 percent in the three election cycles observed since it became a liquid asset.
Binance Research stated that historically strong increases took place in the markets after the election results became clear and the uncertainty disappeared.
The research shows that these evaluations, made an average of eight months before the election day, draw attention to the midterm election years when volatility increases. In the annual presidential cycle, midterm election periods are defined as periods when investors re-set their expectations regarding fiscal policy, regulations and public spending.
Bitcoin’s Historical Performance and Volatility
The report emphasized that midterm election years usually begin with serious setbacks but then end with recovery. While the S&P 500 experienced an average decline of 16 percent from peak to bottom during these periods, Bitcoin’s volatility was higher. Cryptocurrency experienced declines of 56 percent in 2014, 73 percent in 2018 and 64 percent in 2022.
Despite all these losses, it was announced in the report that strong recoveries were observed after the election period in each cycle.
Geopolitical Risks, Energy Prices and Bitcoin
Binance Research pointed out that the current geopolitical conflict involving the USA, Israel and Iran increases macro risks in global markets. It was stated that the disruptions in energy supply, especially through the Strait of Hormuz, increased oil prices.
While increasing energy prices put pressure on risky assets, it is reported that Bitcoin is also affected by global trends in this process. According to Binance analysis, a long-term disruption of oil supply may negatively affect investor perception by keeping energy costs high.
While Bitcoin has been moving close to the $ 70,000 level recently, it is observed that the search for liquidity continues above and below important price ranges in the market structure. Derivative market analyzes reveal that investors are waiting for signals from macroeconomic data to determine a clear direction.
Binance Research states that despite all these short-term uncertainties, the historical pattern of US midterm election cycles offers investors a longer-term perspective. It is stated that, similar to previous cycles, as political uncertainty disappears, there may be a strong rise period for both stocks and Bitcoin.
