Bitcoin’s rise of over 70% in 2024 has surpassed traditional assets such as global stocks and gold – Trump is a declared supporter of digital assets.
Bitcoin is trading at levels not seen since its last rally in March, momentarily surpassing $75,000. The leading cryptocurrency’s single-day gain of over 10% aligns with the Republican candidate’s leading position in all swing states, according to preliminary U.S. election results.
For those following the cryptocurrency market, Trump is well-known as a vocal supporter of digital assets.
Bitcoin increased more than 8%, rising above $75,000 at 10:08 p.m. in New York. This surpassed the March record reached during the euphoria following the launch of American spot-Bitcoin exchange-traded funds (ETFs).
With polls closing in more than two-thirds of states, Trump had taken an early lead in Georgia and North Carolina, two key states influencing the outcome, while vote counting in other states was still in early stages.
According to Fredrick Collins, CEO and founder of the crypto data platform VeloData, “Bitcoin is, in my opinion, one of the top instruments for trading the election tonight. It’s relatively liquid and highly correlated with the outcome. So, it’s fairly safe to assume that any price increases are linked to Trump’s rising victory prospects.”
Other cryptocurrencies also rallied, with Ethereum, the second-largest cryptocurrency, jumping 6.5%. Dogecoin, the so-called memecoin known as Doge, which has been promoted by Trump supporter Elon Musk, saw a surge of over 20%.
“Doge, due to its connection with Musk, has particularly benefited,” said Cosmo Jiang, general partner at Pantera, a crypto-focused investment firm.
Trump has positioned himself as the candidate most friendly to the industry, promising to make the U.S. the cryptocurrency capital of the world, establish a strategic Bitcoin reserve, and appoint regulators supportive of digital assets should he return to the White House. The former president has increased his support among crypto enthusiasts, while Harris has adopted a more measured approach, promising to support a regulatory framework for the industry.
Expected Volatility
Traders were preparing for potentially intense market volatility stemming from the election results. The 30-day index for Bitcoin’s implied volatility reached its highest level since political unrest, including President Joe Biden’s withdrawal from the race, unsettled investors in July.
The options market was signalling expected moves of approximately 8% in either direction the day after the vote, compared to a typical daily fluctuation of 2%, said Caroline Mauron, co-founder of Orbit Markets, a crypto derivatives liquidity provider.
Bitcoin ETF investors removed positions a day before the election, with the 12 largest funds recording record outflows of $579.5 million on Monday, according to data compiled by Bloomberg.
Bitcoin’s over 70% rise in 2024 has outpaced traditional assets like global stocks and gold.
Before elections took centre stage, Bitcoin’s price was buoyed by strong ETF inflows. Funds from issuers such as BlackRock Inc. and Fidelity Investments have attracted around $23.6 billion in net inflows this year, according to data compiled by Bloomberg. The SEC reluctantly approved the funds following a court ruling in 2023. Their launch was one of the most anticipated events in digital asset history.
Industry Expectations
Crypto industry executives were optimistic that either candidate’s stance towards digital assets would contrast sharply with the sector’s crackdown under President Joe Biden, during which many companies faced enforcement actions from the SEC.
Digital asset companies often argue that officials under the Biden administration chose to regulate through enforcement rather than creating a clear new legal framework for the burgeoning market.
SEC Chairman Gary Gensler has criticised the industry’s supposed non-compliance, repeatedly labelling the sector as rife with fraud and misconduct. The agency clamped down on cryptocurrency following the 2022 market crash and collapses like the bankruptcy of Sam Bankman-Fried’s FTX exchange.
Translated from: newmoney.gr
Also read: Trump’s historic comeback – International reactions so far
