Bitcoin rose 4.3% to $71,450 amid the US presidential election, with its 2024 gains surpassing traditional assets.
Traders link Bitcoin's rise to favourable early results for pro-crypto candidate Donald Trump, who has pledged to make the U.S. a crypto hub.
The 2024 US presidential election has brought about a surge in the price of Bitcoin, as traders eagerly await the results. With Republican nominee Donald Trump, a known advocate for digital assets, going head-to-head with Democrat Kamala Harris, who has previously shown a more measured approach towards cryptocurrencies, the outcome of the election could have significant implications for the crypto industry. This article explores the impact of the US presidential election on Bitcoin's price and the expectations surrounding a potential Trump win.
Bitcoin Surges Amid US Presidential Election Tensions
Bitcoin jumped 4.3% to $71,450, notching the biggest gain in a week, amid trader attention to the unfolding results of a hotly contested US presidential election. So far in 2024, Bitcoin has surged over 60%, outpacing traditional assets like global stocks and gold. Market watchers believe the recent rise of Bitcoin is connected to Trump's favorable early results. Frederick Collins, chief executive of the crypto data platform VeloData, said last week that Bitcoin's performance seems linked to Trump's performance in the polls. "It’s relatively liquid and very tied to the outcome. So it’s pretty safe to assume any increases in price are tied to increases in Trump’s prospects of winning," Collins said.
Crypto Becomes Central Issue in Presidential Campaign
Crypto has become a central issue in this presidential campaign, in part because of the extraordinary amount of campaign money coming from the digital asset industry. Trump has been courting crypto fans by promising that if he wins, he will make the U.S. the world leader in digital assets, create a Bitcoin reserve, and install regulators who are friendly to cryptocurrency. Harris, on the other hand, has taken a more measured approach. She supports what she describes as a regulatory balance between allowing the swiftly evolving industry to continue growing while protecting investors.
Investors Gird for Bitcoin Volatility as Votes Are Counted
As traders prepare for market volatility, the 30-day implied volatility index of Bitcoin-essentially, a measure of the expected price swings-has surged to levels not seen since July, when the president's pullout from the race among them- spooked investors. Traders expect very large moves around the US presidential election if data from CF Benchmarks is any guide-the options market is pricing in an 8% move on the day after the election versus normal day moves of around 2%, the firm said.
Investors Take Step Back from Bitcoin ETFs
Investors presumably took a step back ahead of the US presidential election from Bitcoin exchange-traded funds. According to Bloomberg data, spot Bitcoin ETFs recorded an outflow of $579.5 million on Monday, which marks their largest one-day withdrawal, just as traders prepared for what could end up being a huge moment for the cryptocurrency landscape.
In conclusion, the US presidential election has brought about a surge in Bitcoin's price, with traders closely monitoring the unfolding results. The outcome of the election, particularly if Trump emerges as the winner, is expected to have a significant impact on the crypto industry. As investors brace themselves for market volatility, Bitcoin's price swings are reaching levels not seen since July. The digital asset industry is closely watching this election, with both candidates presenting different approaches towards cryptocurrency regulation. Only time will tell how the election results will shape the future of Bitcoin and the wider crypto market.