Manuel Augusto Moreno | Moment | Getty Images
Cryptocurrencies edged higher on Tuesday night as investors awaited direction from the potential outcome of the U.S. presidential election.
The price is Bitcoin It was last up 2% at $69,105.03, according to Coin Metrics. It had previously risen to $70,522.84. After being close to a record high last week, the price is now down 5% from the record high.
Stocks linked to cryptocurrency prices received a boost in early trading during the regular stock market trading session. exchange operator Coin library and micro strategyFrequently trading at a high beta for Bitcoin price, up 4% and 2% respectively.
Investors expect Bitcoin trading to be volatile until a clear winner is declared. A victory for Vice President Kamala Harris is expected to pose downside risks to Bitcoin prices, while traders expect prices to rise if former President Trump wins.
“This election has a huge impact on cryptocurrencies,” said Ryan Rasmussen, head of research at Bitwise Asset Management. “Expect Bitcoin — and cryptocurrencies more broadly — to see volatility in the coming days… until we get clarity. election results.”
“If Trump wins, I believe we will see new all-time highs,” Rasmussen added. “If Harris wins, I expect there will be a pretty big sell-off in the short term and it will take a month or two for prices to recover. But ultimately, either way, I think we’re going to be higher.”
Bitcoin is widely expected to rise to new records in the coming weeks. In the 2012, 2016, and 2020 elections, Bitcoin’s returns within 90 days after election day were approximately 87%, 44%, and 145%, respectively. Part of the reason is that the election year coincides with the Bitcoin halving year, when the cryptocurrency’s supply gradually decreases. Post-election returns also tend to coincide with major policy shifts at the Fed. This year, the market is expecting further interest rate cuts.
Bitcoin was trading around the $70,000 mark early Tuesday, having hit that level for the first time since March last week and closing in on a record of $73,797.68. Bitcoin has been trading at its fair value price of around $69,000, according to CryptoQuant. CryptoQuant analyst Julio Moreno said this means that if the election proves to be a positive catalyst in the coming days, Bitcoin may rebound and be expected to hit new records.
“Everyone we’ve spoken to is wary right now,” said James Davies, CEO of cryptocurrency futures and options trading platform Crypto Valley Exchange. “I’ve heard from numerous leading market makers and traders, and It’s safe to say that almost everyone is ready to react. They don’t even know where the market will go based on the outcome – there will likely be a lot of short-term moves, no matter what the outcome.
This year’s presidential election is being called the most important in the cryptocurrency industry’s lifetime. Many viewed Harris’ victory as a threat to cryptocurrencies, and the extent of that threat has been debated throughout the election cycle. Trump, on the other hand, is seen by many as a force for good in the industry after emerging as a pro-cryptocurrency candidate earlier this year, and has been courting the industry more directly than Harris.
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