The US Presidential elections are taking place today, triggering potential market volatility. Here’s how the elections and their result can affect Bitcoin and crypto.
US Elections and the Crypto Market
Various sentiments and statements regarding the US elections and their importance for the crypto market are present on social media, as follows:
1. The Crypto Market Is Volatile During the US Elections
Historical data shows that the US elections from 2016 triggered a 10.2% dip in the crypto market.
In 2016, the elections were held on November 8, and the Republican candidate Donald Trump defeated the Democratic former Secretary of State, Hillary Clinton. This was the first Republican win for both the Congress and the Presidency since 2004.
The 2020 US elections triggered a 6.1% drop in the crypto market’s cap. Back then, the elections were held on November 3 and the Democrat candidate Joe Biden defeated Trump. The elections took place during the Covid-19 pandemic and the related recession.
Now, the crypto is seeing increased volatility, and the total crypto market cap is at almost $2.3 trillion, up by 0.47% today.
Crypto market dips and high volatility are not out of the ordinary and they also happen outside the elections, so there’s nothing to worry about.
2. The US Elections Results End Either in a Market Boom or Bust
Once the US elections pass, the next four years will offer the markets a clearer view of what to expect. 2024 was a special year that triggered more adoption in the crypto space, especially since the launch of Bitcoin ETFs in the US.
So far, since their January launch, BTC ETFs managed to gather a cumulative total net inflow of over $23.6 billion, surpassing the important $20 billion mark much faster than gold.
Also, Bitcoin and the crypto market have been seeing increased political support as well, with both parties, the Republicans and the Democrats making important promises related to the industry.
Donald Trump has promised to make the US the crypto capital of the world, but Kamala Harris pledged to support the industry as well.
An important Bitcoin Rights bill passed recently in Pennsylvania with strong bipartisan support, so it’s safe to say that Bitcoin and the crypto industry will continue to thrive no matter who is elected as the new US President.
Historical data shows that BTC rallied following the latest elections in 2020 (after the Democrats’ win) and 2016 (after the Republicans’ win), and history could repeat itself, regardless of this year’s winner.
3. Money Printing Will Likely Continue
The US national debt has been rising since 1995, which means more money printing regardless of the party that will run the US.
In a recent post via X, Milk Road posted a graph, revealing the rise in US national debt. During Trump’s presidency which began in 2016, the national debt surged by $7 trillion, and during Biden’s presidency which began in 2020, the national debt surged by $5 trillion, surpassing a total of $30 trillion.
In September 2024, the national debt in the US was above $35 trillion, according to Statista. More money printing means more amounts flowing into the crypto assets, many of which have fixed supplies or low/predictable rates.
It’s also worth noting that money printing devalues the US dollar, but, at the same time, increases the value of crypto over time.
Overall, these are some of the important notes worth taking into consideration ahead of the US election results. The crypto market is confident that regardless of the outcome, optimism is worth maintaining for digital assets.
