Could A "Hated Rally" Fuel Crypto’s Next Leg? What The Midterms and The Binance Hack Mean for Crypto

The roughly $6 billion Binance hack had looked like a potentially catastrophic test for crypto, but Bitcoin fell only 3%–4% and recovered quickly. It also stayed above its 50-week moving average, which one speaker said traders increasingly view as bull-market support. The speakers saw this resilience, alongside the market’s response to the U.S. midterms, as evidence that negative headlines may no longer be enough to derail prices.

One speaker said traders sold ahead of the midterms, then bought back as the sell-the-news reaction faded; markets rose sharply over about 12 hours after the results. They compared the pattern with Q2, when markets absorbed negative catalysts before rebounding, and described the move from $87,000 to $75,000 as a washout of leverage and speculative exuberance. Their bullish forecast was that Bitcoin’s bottom was in: after a recent low around $58,000–$60,000, it was about $80,000 at recording, with new all-time highs possible in Q1 or Q2 of the following year. The speaker called this “high-level bull propaganda,” not financial advice.

The speakers described a possible “hate rally,” with crypto rising despite poor sentiment and negative headlines. One expected Bitcoin to benefit and Zcash to rise more, while suggesting retail investors might return once Bitcoin reached $100,000 or $125,000. The bullish case also drew on the four-year-cycle thesis and historical strength in the S&P 500 and Bitcoin after midterm years. But the speakers cautioned that Bitcoin remains a risk asset and would not be expected to thrive through a major equity collapse. One expected equities to stall rather than plunge or rally sharply, while raising the possibility that an activist Federal Reserve might provide an “AI backstop” if stocks fell hard.

Political and regulatory developments could create both tailwinds and delays. The speakers argued that political constraints may slow AI investment more than digital assets, with analysts said to anticipate a possible 10%–20% slowdown in AI investment. They cited bipartisan support for Bitcoin, including a Florida Republican governor backing a U.S. Bitcoin Reserve and a Texas Democratic senator voting for a state reserve. At the same time, one expected Democrats to investigate Trump and his family’s crypto ties, potentially slowing regulation and tokenization in the short term; Elizabeth Warren was expected to lead the Banking Committee. The speakers also anticipated an Anthropic IPO within two weeks and Nvidia earnings the following day, while one suggested crypto could turn before equities as capital rotates into digital assets.

On investment themes, speakers favored store-of-value assets such as Bitcoin, Zcash and potentially ETH, and preferred established products and revenue-generating protocols over new layer-1, layer-2 and infrastructure tokens. One described being fully allocated and more concentrated, favoring ETH, Bitcoin and some Solana; they called Zcash their strongest current idea but said its prior gains made future returns less certain. Another forecast a Zcash run resembling Bitcoin’s in 2015 and sought a 20–40x return. They saw room for Zcash to gain share without overtaking Bitcoin, while acknowledging that its value is difficult to assess and that displacing a category leader is hard.

The speakers viewed perpetual futures, tokenization and prediction markets as expanding parts of on-chain finance. They cited Hyperliquid and Lighter as potential leaders in perps, noted rising volumes including Lighter’s real-world-asset volumes, and called Hyperliquid’s deal with ICE a fit for perps and tokenization. Tokenized assets could gain utility through lending, collateralization, exchange, staking and vaults. One speaker contrasted an estimated $200–$400 trillion in global financial assets with $160 billion in DeFi TVL, arguing that moving even 0.5%–1% on-chain over the next few years could sharply increase volumes, TVL and revenue. They also pointed to rapid stablecoin growth and forecast large-bank infrastructure next year, with one expecting stablecoin supply to reach trillions by year-end or early 2028. Across crypto, they emphasized researching founders and product quality, and favored category leaders and businesses with revenue over speculative tokens.