The Democrats’ midterm sweep is rattling some of the digital-asset market’s most politically exposed investments, from cryptocurrencies tied to Donald Trump to the sprawling Texas data-center projects underpinning valuations of companies that used to be known as Bitcoin miners.
The price of WLFI tokens from World Liberty Financial, co-founded by Trump, dropped by about 6% in the last 24 hours, while his namesake memecoin declined about 19%, according to data compiled by CoinGecko.com. Trump Media & Technology Group Corp. shares tumbled 25%, while the exchange-traded fund DJTU, providing leveraged exposure to the company, declined almost 50%.
“It’s a reflection of both the drop in cachet and the likely investigations/prosecutions in the pipeline,” said Noelle Acheson, who writes Crypto is Macro Now newsletter. “The mining stocks are getting hit by a shift in the outlook for data-center construction.”
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Fight Fight Fight, which issues the Trump memecoin, didn’t immediately return a request for comment. World Liberty Financial declined to comment on the price drop.
“Since its inception, World Liberty Financial has complied with all applicable US laws and regulations,” according to spokesman David Wachsman. “It’s troubling that Congress might baselessly target a compliant company that has dedicated itself to expanding access to the US dollar when there are a plethora of issues afflicting the American public that need to be addressed.”
Investors also reassessed plans to turn mining facilities into AI campuses. In Texas, the election of a governor who campaigned against unrestricted data-center development threatens a particularly important pipeline of future computing capacity. The Democratic sweep is expected to slow down data-center buildouts, while their builders continue to shoulder heavy financing costs. Shares of Michael Novogratz-led Galaxy Digital Inc. lost nearly 17%, while Hut 8 Corp. dropped 23% and MARA Holdings Inc. declined about 4%. Cipher Digital, Core Scientific and IREN have plummeted at least 10%.
“Any slowdown in the buildout could put significant stress on AI-linked neoclouds, as financing costs will mount even as revenues are pushed back,” said Matthew Hougan, chief investment officer at Bitwise Asset Management. “It’s like when someone is building an apartment building and runs into construction delays; the financing costs continue while the revenues never appear.”
In particular, those that have major sites in Texas are among the hardest hit. The Lone Star state accounts for nearly 30% of the US data center capacity set to come online in 2028, representing by far the largest share of any state, according to research firm SemiAnalysis.
“The change of political control in Texas could yield additional data center regulations,” said Brian Dobson, managing director of disruptive technology equity research at Clear Street. “We believe that would favor established incumbents with strong track records as good corporate citizens.”
Gina Hinojosa, the first Democrat elected to be Texas’ governor in more than 30 years, defeating Greg Abbott, is likely to have a tougher stance on data centers. Her campaign platform advocated for an imminent moratorium.
But some say investors may be over-reacting.
“Since the Trump admin has been so pro-AI, however, the selloff seems like an overreaction because if anything these Bitcoin mining firms are now even better positioned,” said Adam McCarthy, head of research at trading firm LO:TECH. “They already have the infrastructure built and have been repurposing it, if the Dems are stricter on the AI build out that could potentially make existing infra more valuable.”