Billionaire hedge fund manager Ray Dalio says that the balance of power in the US Congress could change in favour of Democrats in the 2026 midterm elections because of concerns about inflation. This could overturn regulatory policies put in place by the Republican Party and US President Donald Trump.
The issue of affordability will probably be the most important political issue next year. This will lead to the Republicans losing the House and a very messy 2027 on the way to a fascinating 2028 election. He also said, “Because of how our democracy works, President Trump has a two-year unimpeded mandate that can be weakened greatly in the 2026 mid-term elections and reversed in the 2028 elections. It’s not common for one party to stay in power for a long time these days.
The Trump administration’s tech-orientated legislative plan, which concentrated on digital technology and AI, has helped the crypto business a lot.
A change in the balance of power might overturn the pro-crypto regulatory shift that happened in the US under Trump before important laws like the CLARITY market structure bill are signed into law.
Democrats, the CLARITY Act, and a potential policy reversal
TD Cowen, an investment bank, said that the CLARITY market structure bill could be pushed back to 2027 because Democratic lawmakers are waiting for the 2026 midterm elections to vote on it.
Currently, Republicans have a slim five-seat majority in the House of Representatives.
Traders on the prediction market Polymarket say that the Democratic Party has around a 78% chance of winning the House in November.
The House majority is quite small, and it probably changes hands because it almost always does.