Democrats took control of the House and Senate after the Nov. 3 midterm elections, prompting crypto markets to reassess the regulatory outlook and prospects for different digital assets. The shift is unlikely to affect every token in the same way: Bitcoin has broader institutional participation and policy recognition, while XRP still faces stablecoin competition, regulatory uncertainty and price volatility.
Bitcoin benefits from broader institutional and policy support
Bitcoin, the largest cryptocurrency by market value, uses a proof-of-work (PoW) system in which miners use computing power to verify transactions and earn block rewards. Mining rewards are cut roughly every four years, and the final bitcoin is not expected to be mined until 2140. Its fixed issuance schedule has led supporters to call it “digital gold” and to view it as a potential hedge against declining fiat-currency purchasing power. El Salvador has made Bitcoin legal tender.
The U.S. Securities and Exchange Commission (SEC) approved the first spot Bitcoin ETFs in 2024. The Trump administration that followed took a more crypto-friendly policy approach and established a Strategic Bitcoin Reserve. Earlier this year, the SEC and Commodity Futures Trading Commission (CFTC) said in a joint statement that Bitcoin is a digital commodity, not a security. These developments have broadened bipartisan policy support and given institutional investors a clearer basis for participation, though they do not rule out further regulation.
Bitcoin’s market capitalization is about $1.4 trillion. Companies such as Strategy have added Bitcoin to their balance sheets, and whether other firms follow suit is one measure of corporate demand. For investors, institutional adoption and regulatory classification set Bitcoin apart from smaller tokens, but neither removes the volatility inherent in crypto assets.
XRP’s legal case is over, but competition remains
XRP is the native token of the XRP Ledger, created by the founders of Ripple, a financial technology company focused on blockchain payments. In 2020, the SEC sued Ripple’s founders, alleging that XRP sales used to finance the company’s expansion involved an unregistered securities offering. The case lasted five years, during which some major crypto exchanges delisted XRP.
The case ended in 2025 with a lighter penalty and a ruling that XRP was not a security when sold to retail investors. Exchanges subsequently relisted the token, the SEC approved the first spot XRP ETFs in late 2025, and some financial institutions began using XRP for cross-border transfers.
Stablecoins compete as US legislation stalls
A series of positive developments helped lift XRP to a multi-year high of $3.65 last July. By Nov. 12, however, it was trading at about $1.02. As market enthusiasm cooled, stablecoins pegged to the U.S. dollar and other fiat currencies were competing for cross-border payment demand. They can also be used to transfer funds internationally, making them direct competitors. Ripple itself launched a stablecoin in late 2024.
The CLARITY Act, which was intended to establish a clearer regulatory framework for XRP and other smaller tokens, failed to pass the Senate. For XRP to serve as a reliable bridge asset for fiat transfers, its price would need to remain stable rather than fluctuate sharply and unpredictably. Its technology could still be used to modernize traditional payment infrastructure, but tighter regulation could constrain the growth of blockchain-based cross-border transfers. Policy decisions and competition will continue to shape XRP’s role in payments.