Republican control of the Senate would be key to passing bills such as FIT21 and appointing pro-crypto agency leaders, and digital asset reform would likely happen sooner with both chambers aligned, the report said.
The network hashrate has risen 4% so far this month, while the hashprice is up less than 1%, the report said.
If bitcoin follows historical patterns post halving a rally could start between now and April, the broker said.
Defying typical September trends, bitcoin's resilience hints at a potential breakout from its prolonged downtrend.
The recent Federal Reserve interest cut will fuel increased onchain activity, and this will strongly benefit the Ethereum blockchain, the report said.
The Ethereum blockchain has the most active developers, the most active users and a market cap that is five times larger than its nearest competitor, the report said.
Bitcoin is expected to end the year at new all-time highs regardless of who wins the U.S. election, the report said.
Total crypto market cap was $2.02 trillion at the end of August, a 24% decline from this year's peak of $2.67 trillion in March, the report said.
Spot ether exchange-traded funds have seen net outflows of $0.5B since their launch, the report said.
Total value locked across the crypto ecosystem is expected to reach an all-time high in the first half of next year, the report said.
The number of institutional investors holding bitcoin ETFs rose 14% in the second quarter of the year to 1,100, the report said.
The ability to raise debt or equity in the world's deepest capital markets is a major advantage, the report said.
The total market cap of the fourteen publicly listed mining stocks the bank tracks fell 18% since the end of last month, the report said.
Retail investors seems to have played large role in recent crypto selloff that saw sharpest correction since FTX, the bank said.
Investors are pouring money into spot ETFs while avoiding miners due to risks related to Bitcoin's halving event.
The amount of ether held on exchanges is at an all-time low of 11%, a sign that more of the cryptocurrency is being locked up for DeFi, the report said.
Periodic observations and market musings from Todd Groth, Head of Research, CoinDesk Indices.
The broker says it prefers outperform rated mining stocks Riot Platforms (RIOT) and CleanSpark (CLSK).
Ether price dropped 14% as the entire crypto market sold-off, but derivatives data points to a silver lining.