Bitcoin traded lower Wednesday as growing expectations of a Democratic sweep of Congress injected fresh political risk into a digital-asset market already shaken by the largest crypto theft on record.

The largest cryptocurrency fell as much as 1.6% during Asian hours and changed hands near $76,600 by late morning in Singapore, according to market data. The move tracked a softer tone in U.S. equity futures and the dollar, while Treasuries drew buyers as traders weighed the prospect of divided government in Washington.

The immediate worry for crypto holders is legislative. A Democratic takeover would likely stall industry-backed bills and could invite closer supervision of digital-asset companies, reversing the friendlier posture the…