The political shift of 2026 could shake up more than just the White House. For the crypto industry, the fragile balance between executive power and pro-innovation legislative support achieved under Trump is already under threat. Ray Dalio is sounding the alarm: the upcoming midterm elections could overthrow the majority in Congress and slow down the American crypto agenda. Between political uncertainty and economic pressures, a new cycle of regulatory instability seems to be looming.
In brief
- Ray Dalio warns of a possible political reversal in the 2026 American mid-term elections.
- A Democratic victory could weaken, or even reverse, the Trump administration's pro-crypto agenda.
- The crypto sector currently benefits from a favorable, but fragile, legislative window until the end of the year.
- A political impasse could plunge the crypto ecosystem into a new period of regulatory uncertainty.
Trump's pro-crypto agenda on borrowed time
As implementation of the Genius Act continues, Ray Dalio, founder of hedge fund Bridgewater Associates, warned in an analysis: “affordability will likely be the number one political topic next year”.
According to him, this dominant concern in the American electorate could tip the majority in the House of Representatives in 2026. He adds: “This will contribute to Republicans losing the House and lead to a very chaotic 2027, en route to a particularly interesting 2028 presidential election”.
Dalio also emphasizes the little room for maneuver left to Donald Trump: “President Trump has an unfettered two-year term, which could be greatly weakened in the midterms and completely reversed in 2028”.
This limited legislative window is all the more strategic as the crypto sector is currently benefiting from unprecedented political momentum. The Trump administration has initiated several reforms favorable to technological innovation, some of which are directly aimed at regulating cryptos. Among these measures, several legislative initiatives supported by the Republicans could reshape the American regulatory landscape, provided they are passed before 2027.
Among the projects currently supported by the Republican majority, we note:
- The CLARITY Act, which aims to clarify the legal status of cryptos and define a coherent market structure in the United States;
- Affirmed support for emerging technologies, notably blockchain and artificial intelligence, considered pillars of American technological sovereignty;
- A moderate approach to regulation, far from the hard line adopted by the SEC under the previous presidency;
- The promotion of pro-crypto political figures, such as Republican elected officials favorable to financial innovation, to carry these laws.
However, this dynamic is based on a precarious institutional balance. The Republicans only have a majority of five seats in the House, making any electoral swing potentially decisive. In the event of loss of this majority in 2026, a large part of this agenda could be suspended, or even abandoned, before even having been achieved.
Towards a legislative blockage: the Democrats' waiting strategy
Beyond Ray Dalio's projections, it is the attitude of the Democrats which confirms the vulnerability of the crypto agenda.
According to an analysis published by the investment bank TD Cowen, several elected Democrats would seek to delay the vote on the CLARITY Act until after the midterm elections, banking on a majority reversal to slow down or rewrite its terms. The strategic wait could thus postpone the adoption of this structuring text until 2027, compromising the legal readability of the crypto sector throughout the remainder of Trump's mandate. At this stage, no decisive vote has yet been held, illustrating the opposition's tactical caution.
In the area of predictions, on-chain data seems to be converging. According to Polymarket, a platform specializing in predictive markets, the chances that the Democrats will take back the House in November 2026 are estimated at 78%.
This probability, if it materializes, would have the immediate effect of blocking numerous pro-crypto legislative initiatives, making any consensus between the two chambers of Congress impossible. As Joe Doll, legal counsel for NFT marketplace Magic Eden, points out, “the majority in the House is extremely thin, and it almost always swings. We could then end up with a divided government, where everything freezes for two years”.
The political calendar is accelerating. While institutional balances remain uncertain, the CLARITY Act will be debated in the US Senate this month! A crucial deadline for the crypto industry, which could mark a decisive turning point… or open a new period of regulatory wait-and-see.
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