Volatility in the cryptocurrency market could see Bitcoin soar or fall, depending on whether or not the former president is in power. Donald Trump or vice president Kamala Harris emerges victorious.
Gautam Chhugani, head of research at Bernstein, highlighted that the elections are poised to have a short-term impact on cryptocurrency sentiment.
After a recent high of over $73,000, Bitcoin’s current price reflects the market’s cautious optimism awaiting the election outcome, as mentioned in a Forbes report.
Trump’s pro-crypto stance
Chhugani predicts that if Trump achieves a victory, Bitcoin could potentially climb to between $80,000 and $90,000 over the next two months. This upward move would break the previous all-time high of around $73,800 recorded in March.
Read also: US Election 2024: Can I vote without ID? What you need to know about state ID requirementsTrump’s campaign was characterized by a pro-crypto stance, and he gained support from key figures in the cryptocurrency industry, including billionaires Marc Andreessen and the Winklevoss twins. His association with longtime Bitcoin advocate JD Vance as his running mate reflects his alignment with the crypto community.
Harris’ Regulatory Concerns
Conversely, if Harris wins the presidency, analysts warn that Bitcoin could test an important support level of $50,000, which would mark a notable decline of over 25% from current prices.
Chhugani attributed this bearish sentiment to the Biden administration’s strict regulatory approach to the crypto sector, which has sparked concerns among investors about the future viability of cryptocurrencies under a Harris-led administration .
Long-term outlook remains optimistic
Despite the potential short-term consequences of the election on Bitcoin prices, Bernstein analysts maintain a bullish long-term outlook, retaining their $200,000 price target for Bitcoin by the end of 2025.
They argue that the proliferation of spot Bitcoin exchange-traded funds (ETFs) has solidified the digital asset’s place in the market, suggesting that Bitcoin’s momentum is now irreversible.
Market Dynamics and the Future of Bitcoin
In the broader context of market dynamics, Standard Chartered analyst Geoff Kendrick noted that if Harris wins, Bitcoin could end the year at around $75,000, while a Trump victory could see it reach $125,000. Analysts point out that predicting Bitcoin prices is inherently difficult, as they are influenced more by market perceptions and feelings about future utility than traditional metrics such as earnings.
Correlation between Bitcoin prices and election chances
In recent months, there has been a notable correlation between Bitcoin prices and Trump’s electoral chances on blockchain-based betting platforms.
Notably, Bitcoin prices hit a seven-month high on the same day that Trump’s election prospects peaked.
Conversely, recent increases in Harris’s election chances correspond with a decline in the value of Bitcoin, suggesting that traders are closely monitoring the electoral landscape when making investment decisions.
FAQ:
What does Bitcoin mean?
Bitcoin is a digital currency that operates independently of central authorities, banks, or government oversight. Instead, it relies on peer-to-peer networks and cryptographic technology to operate securely.
Who is the founder of Bitcoin?
Bitcoin was developed by an anonymous individual or group under the pseudonym Satoshi Nakamoto. Nakamoto published a white paper titled “Bitcoin: A Peer-to-Peer Electronic Payment System,” which introduces the idea of a decentralized digital currency.
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