Bitcoin Falls as U.S. Chip Losses Reach 12% Ahead of Midterm Elections

Key Facts

Bitcoin fell on November 2 as a sell-off in technology and U.S. chip stocks widened ahead of the midterm elections. CoinDesk said an index of U.S. chipmakers extended its losses to 12% during a three-day sell-off through that date. It added that the Nasdaq 100 was down 10% from its peak, a level known in markets as correction territory. The S&P 500 fell 0.5% in the same session. The moves occurring together show digital assets and stocks facing pressure in the same session, but do not prove that the election caused Bitcoin’s decline.

Attention is turning to the midterm elections scheduled for November 3, held halfway through a presidential term and capable of changing control of Congress. Reuters reported that investors are watching for potential effects of the results on AI-related spending and debt-ceiling negotiations. Against this backdrop, the S&P 500 has risen about 27% since Donald Trump returned to the White House in 2025, Reuters reported. The news agency linked the advance to heavy capital spending on AI and strong earnings growth. The election therefore comes amid strong gains in the index, with investors questioning the path of spending and fiscal policy after the vote.

The scenarios investors are watching vary according to the distribution of seats in the two chambers of Congress. Reuters said a Democratic victory in both chambers could prompt tighter scrutiny of AI companies, potentially weighing on markets. A divided Congress would keep the risks of a government shutdown and a confrontation over the debt ceiling in play, the news agency said. In a historical comparison from Ned Davis Research cited by Reuters, the president’s party lost control of the House in 8 midterm elections since 1930. The S&P 500 rose for the rest of the year in 5 of those cycles, recording a median gain of 1.4% between Election Day and year-end.

Bitcoin and Ether losses also coincided with the fallout from the Binance platform breach in the week before the November 2 report. Reuters reported that the record breach was valued at $6.3 billion and that the two currencies were nursing losses after the incident. The news agency noted that traders were bracing for a busy week that included the midterm elections, U.S. jobs data and interest-rate decisions in Britain, Australia, Norway and Sweden. These events put cryptocurrency moves within a week shaped by multiple financial and political influences. Reuters did not attribute Bitcoin and Ether losses to a single factor, but cited the breach and upcoming events in the context of market pressure.

In the November 3 session, the Asia-Pacific index excluding Japan fell 1.4% to its lowest level since October 23, according to Reuters via MarketScreener Canada. South Korean stocks led the decline, falling 4.1% during the session. Asian shares weakened as pressure on U.S. chip stocks extended, according to CoinDesk. Investors were awaiting the election results, with the first results expected to start emerging at the open of Asian markets on Wednesday, November 4. Market direction in subsequent sessions therefore remained tied to the flow of results and what they could signal for spending and debt issues watched by investors.