Stocks tied to the cryptocurrency industry, including the Defiance Daily Target 2X Long MSTR ETF (MSTX), rallied on Wednesday amid expectations that the newly elected pro-crypto Republican government could pave the way for more favorable regulations and wider adoption of digital assets.

MSTX, which aims to provide leveraged exposure to the performance of MicroStrategy (MSTR), a company that has invested heavily in Bitcoin, saw a surge of 5.15% during the trading session. The ETF's gains reflect the optimism surrounding the potential impact of a crypto-friendly administration on companies with significant Bitcoin holdings or exposure to the cryptocurrency ecosystem.

Analysts suggest that the election outcome could lead to more clarity and supportive policies for the crypto industry, which has long faced regulatory uncertainties. A pro-crypto stance from the government could potentially boost institutional adoption of digital assets and provide a tailwind for companies operating in this space.