Original | Odaily Planet Daily (@OdailyChina)
Author | Wenser (@wenser 2010 )
As the US election draws to a close, the subsequent direction of the crypto market, which is greatly affected by the US political and economic situation, has become a focus of close attention in the market recently.
Will the BTC price break through a new high as expected? Will the ETH price continue to maintain its current weakness? Will the Meme coin craze in the Solana ecosystem continue? Will the Altcoin market gradually recover? Odaily Planet Daily will sort out and analyze the current situation of the US election and the existing views on the crypto market in this article for readers' reference.
Latest Poll: Trump Temporarily Leads, Harris Closely Follows
Overall, the Republican presidential candidate Trump currently leads in terms of support rate, but the lead is relatively small; the Democratic presidential candidate, US Vice President Harris, is slightly behind in support rate.
A Brief Analysis of the US Election Rules: 270 Electoral Votes is the Key
According to the rules of the US election, the 50 states have a certain number of electoral votes, a total of 538 nationwide, and the candidate who wins 270 or more votes will be elected. Except for two states (Nebraska and Maine), all states adopt the "winner-take-all" rule, that is, once a candidate wins more votes in that state, he or she will get all the electoral votes of that state. Most states are overwhelmingly supportive of one party, so the focus of the campaign usually falls on a dozen or so swing states that are evenly matched.
Looking at the US elections over the years, the key to success is the seven "swing states" with a total of 94 electoral votes, and their results will determine the occupant of the presidency.
Latest Poll: Trump Support Rate Reaches 52%
The latest poll shows that Trump is leading Harris, with 52% of voters supporting Trump to become the next US president.
Previously, in a poll conducted by The Wall Street Journal, Trump led Harris with 47% support against 45%.
In the latest poll conducted by the UK's Financial Times, Trump is ahead of Harris on the US economy.
The latest betting information on the crypto prediction market Polymarket shows that Trump has a 60.7% chance of winning, while Harris has a 39.4% chance.
According to the information on the website of the well-known US political election website RCP, the current forecast is that the Trump/Vance ticket is expected to win more swing state votes, and may ultimately win 312 electoral votes, winning the election.
US Election Forecast Results
Market View: Trump's Election Victory Rate is Highly Correlated with Crypto Asset Price Trends
Previously, Monad's growth manager Intern had stated that the curve of Trump's victory rate on Polymarket is highly positively correlated with the BTC price trend.
The chart selects relevant data from March to October this year
QCP Capital had previously pointed out in a report that as Trump's chances of winning increase, the market expects his crypto policies to be more friendly than Harris, further strengthening the positive correlation between crypto assets and Trump's victory.
As previously analyzed by Galaxy Research, although Harris is more friendly to cryptocurrency policy than the current President Biden, in the market's view, it is far less than Trump. After all, Harris has promised to improve the regulatory environment of the US crypto industry, but takes a more cautious stance on issues such as taxation, BTC mining, and self-custody, while Trump supports BTC mining and promises to protect self-custody rights.
Bitfinex Alpha's research report also pointed out that the correlation between BTC price trends and the probability of Trump's election has strengthened, as investors assess the potential impact of a Republican victory on future crypto regulations, and the crypto market has shown higher sensitivity to the US election. In addition, the open interest (OI) of BTC perpetual contracts and futures contracts has soared to a historical high of over $40 billion, reflecting an increase in speculative activity, indicating that the current price trend is largely driven by leveraged futures positions rather than spot market demand.
The "Key Men" Behind the Candidates: Musk Splashes $75 Million, Bill Gates Angrily Presses $50 Million
The US presidential election not only involves political choices, but also various aspects of the US economy, and the key to victory is the support of funds, resources, and momentum, and by looking at the "key men" behind Trump and Harris, we may also get a glimpse of the trend in the US political and economic arena.
Musk: The "First Person" to Wave the Flag for Trump
Previously, according to documents from the US Federal Election Commission, Elon Musk donated $75 million to a political action committee supporting Trump. Moreover, last Thursday, Musk went to the swing state of Pennsylvania to give a campaign speech for Trump's presidential bid; subsequently, he called on Pennsylvania voters to express their support for Trump through various campaign signs, and announced that from that day (October 19) until the US election day on November 5, he would randomly distribute $1 million per day to a registered voter in Pennsylvania who signed the "America PAC" petition. The first winner of the day has already emerged.
It must be said that Musk has "paid, sent people, and worked hard" for Trump's campaign, no wonder Trump previously said: "Thank you Elon Musk, he gave me the best support."
Bill Gates: Privately Donated About $50 Million to Harris' Campaign Organization
Bill Gates, the former richest man in America who has been out of politics for decades, privately stated that he recently donated about $50 million to the non-profit organization Future Forward, which supports Vice President Harris' campaign. This donation was originally kept secret. A person familiar with Gates' thinking revealed that in private conversations with friends and others this year, he had expressed concern about the prospect of Trump being re-elected president, although he stressed that he could work with any candidate.
Billionaire Bill Ackman: If Trump is elected, I will do my best to provide assistance
Billionaire Bill Ackman stated that Harris and Trump are like the best candidates in the world, and it's too difficult to choose between them because they are both so outstanding. If Trump is elected president, many very capable businessmen will want to join this government, and I will do my best to help him, but I will not become a member of the government. He believes that Trump (if elected president) will not have any problems in assembling a highly capable team.
a16z founders: Donate $2.5 million each to Trump's campaign organization
According to the latest documents filed with the Federal Election Commission, a16z founders and venture capitalists Marc Andreessen and Ben Horowitz each donated $2.5 million to a super PAC supporting Trump. The two had announced their support for Trump in July. Andreessen also donated an additional $844,600 to Trump's campaign team and the Republican Party, which is the federal government's limit.
Billionaire Tim Draper: Bet on both sides, with similar donation amounts
Billionaire, American venture capitalist Tim Draper clarified in a post: "I have donated to both the Harris and Trump campaign teams, and the amounts are roughly equal, which allows my wife and I to meet with the two candidates and make a wiser decision. The starting points of the two candidates are both correct, although they will set different paths for America, but I am optimistic that any path will be a positive step. I support both candidates."
In general, crypto-friendly individuals are more supportive of Trump; while people associated with traditional venture capital institutions are more inclined to bet on both sides or support Harris.
Market Perspective: Most believe Trump's victory is beneficial for crypto, a few believe the eventual winner will promote crypto development
Looking at the current market perspective, most research institutions and related organizations are optimistic about the development of the crypto market after Trump takes office; a small number believe that whether it is Trump or Harris, after taking office, they will both help promote the further development of the crypto industry; but there are also a few views that Trump's victory may lead to a decline in the crypto market.
Traditional Institutions: Optimistic about the crypto market after Trump takes office
A research report by Citibank stated that if the Republican Party wins a complete victory in the upcoming U.S. election, it will be the most favorable outcome for Coinbase and the broader crypto market, while a Harris victory and a divided Congress could lead to greater uncertainty in the digital asset industry.
Geoff Kendrick, head of digital asset research at Standard Chartered Bank, stated that Bitcoin is showing a strong upward trend and may approach the historical high of $73,800 before the U.S. election. The potential price increase is driven by multiple factors, including the steepening of the U.S. Treasury yield curve, inflows of funds into spot Bitcoin ETFs, and an increase in the probability of a Trump victory. Current data shows that Trump's probability of winning is 56.3%, and the probability of a Republican sweep is 39%, which could create favorable conditions for risk assets including Bitcoin. In addition, the open interest of $80,000 call options on the Bitcoin options market has also increased recently, indicating that institutional investors are optimistic about Bitcoin's medium-term upside potential.
In a report, BNP Paribas said that the outcome of the U.S. election in early November will determine the near-term outlook for the U.S. dollar. If the Republican candidate Trump becomes president and the Republicans control Congress, it will be the most positive result for the U.S. dollar.
Crypto Enthusiasts: Trump Will Help Bitcoin Price Reach $100,000
Jeff Park, head of alpha strategies at crypto asset management firm Bitwise, predicted that if Trump wins the U.S. presidential election in November, Bitcoin's price could rise to $92,000. He said that based on a chart plotting Bitcoin price against Trump's winning odds on Polymarket, and applying some "merger arbitrage-style probability math", the results show that if Trump wins the election, Bitcoin's price is likely to soar. In addition, early Bitcoin investor Erik Finman said he believes Trump's victory could push Bitcoin's price up to $100,000, "his policies will ignite the crypto market and drive massive growth across the board."
Augustine Fan, head of SOFA.org, stated, "As the focus on the outcome of the U.S. election becomes the focal point, the most positive outcome for cryptocurrencies will be a Trump victory, with the Republicans sweeping the House and Senate, which could allow the Trump-Pence-supported digital asset reform plan to pass through Congress." Jung added, "If Trump's dominance continues, the Fed sends more dovish signals, we may see a new momentum in Bitcoin in the weeks following these events."
Alex Svanevik, CEO of blockchain analytics firm Nansen, argued that the primary condition for the biggest bull market in history by 2025 is a Trump victory in the presidential election.
Neutral Perspective: Whoever Wins Will Lead to Economic Risks and Market Declines
Mike Wilson, chief U.S. equity strategist at Morgan Stanley, stated that while some believe a Trump victory would be detrimental to economic growth and the stock market, a Harris victory could also disappoint Wall Street. Polls show there is a 50% chance of this happening. However, Wilson also pointed out the risks of a market decline if Trump wins.
An analyst at trading and financial services firm Presto stated that the U.S. election could trigger a collapse in the bond market, which will also impact assets like Bitcoin. Jones said that in the current risk environment, he is bullish on Bitcoin, gold, commodities, and Nasdaq stocks. The analyst believes that both Republican candidate Trump and Democrat Harris have promised "fiscal profligacy", leading to a continuous rise in government debt levels, which exacerbates the risk of a bond market collapse. Additionally, the "Bitcoin 2024 Act" currently awaiting Congressional approval may help stabilize U.S. debt, and even stabilize the global financial system.
Neutral Perspective: Whoever Wins, It Will Benefit the Crypto Industry
Haseeb Qureshi, managing partner at crypto venture fund Dragonfly Capital, stated, "Regardless of who wins, the post-election environment should be favorable for potential crypto IPOs." He said that while Trump may push the SEC to take a more crypto-friendly stance, Harris may "replace Gensler with her own picks, which should lead to a more benign crypto regulation in the U.S."
David Lawant, the research director of the cryptocurrency market maker FalconX, stated that "I think the market consensus is that Bitcoin is likely to perform well regardless of the election outcome, and our analysis shows that the market is exhibiting a clear bullish bias in option activity around the upcoming election." The Republican candidate, former President Trump, has openly supported cryptocurrencies, to the extent that Bitcoin has been seen as a so-called "Trump trade." His Democratic opponent, current Vice President Harris, has promised to support the industry's regulatory framework, in contrast to the Biden administration's crackdown on the industry. Further interest rate cuts by the Federal Reserve and other non-political factors are seen as fueling the optimistic sentiment.
Mick Mulvaney, former acting White House chief of staff in the Trump administration, stated that cryptocurrencies are an industry that "breaks the American political model" because it has appeal to both the Democratic and Republican parties.
Opposing View: Harris Will Be an Obstacle to More Crypto ETF Applications
Two ETF experts said that if Democratic presidential candidate Harris wins the November election, applications for XRP and SOL ETFs may not come to fruition. Bloomberg senior ETF analyst Eric Balchunas said: "If Harris wins, it doesn't matter who the issuer is, it's not going to get approved." Some industry experts believe that the entry of asset management giant BlackRock into the race to launch Bitcoin and Ethereum ETFs has greatly increased the chances of SEC approval - although it is unclear how much of a role BlackRock has actually played.
Balchunas said that if former President Trump wins the election, there would be a "pretty good chance" of seeing more cryptocurrency ETFs, regardless of whether BlackRock joins Bitwise, VanEck and others hoping to expand crypto ETFs beyond BTC and ETH.
Opposing View: The "Trump Trade" Brings Obstacles for Cryptocurrencies, Cooling Bitcoin's Rally
As Trump leads Harris in prediction markets, US bond yields and the US dollar have recently risen sharply. Investors are curbing bets on loose monetary policy, as if Trump wins the election, he will implement pro-growth measures on the already relatively strong US economy. With the financial environment tightening relatively, Bitcoin has seen its first weekly decline in three weeks.
IG Australia market analyststated that stock sell-offs, a stronger dollar, and rising yields all mean a tightening financial environment. This is not good for cryptocurrencies. Some may point out that the financial environment has been very loose from the start, but the speed of tightening is more important. The co-founder of digital asset derivatives trading liquidity provider Orbit Markets said that a Trump victory could lead to higher US bond yields, ultimately negatively impacting risk assets. However, the expected softening of the Trump administration's regulation of the crypto industry should still be a more important factor.
Conclusion: Before the Election, Bitcoin May Correct and Then Rally
Currently, the voices calling for a Trump victory are relatively high, and in addition to the crypto industry's eager anticipation of this, the traditional financial market is also "warm" about it - according to Barclays Bankstated, the European stock market has already priced in the possibility of a Trump victory. The company said that since the early spring of this year, a basket of European exporters, i.e. those companies most susceptible to tariffs, have underperformed the benchmark Stoxx Europe 600 index by 15%, to some extent, the European stock market has priced in a Trump victory.
The data from Polymarket, the "crypto weather vane", also corroborates this possibility, with users Fredi 9999, Theo 4, PrincessCaro and Michie collectively investing $30 million to bet on Trump winning the 2024 presidential election; another Polymarket user zxgngl recently bet over $5 million on a Trump victory. Analysis pointed out that the influx of over $35 million in bets may have driven the recent significant increase in Trump's winning probability.
Although venture capitalist and Polymarket seed round investor Alex Marinier said that it is entirely possible that "some big shots are making big bets to sway the market"; but Kalshi founder Tarek Mansour recently provided Kalshi's comparable data to believe that these results are accurate rather than manipulated. He stated that "Harris' median bet is higher than Trump's", with Harris' median bet at $85 and Trump's at $58. More and more people are betting on a Trump victory on the platform, and the 20 percentage point lead reflected on Polymarket is roughly consistent with the number of people. Based on the current total bet of over $2.4 billion on Polymarket, Trump's winning probability may have been clearly demonstrated in this data.
And thanks to Trump's previous series of crypto-friendly statements, combined with the gradual dissemination and spread of various positive news before the election, this may drive the crypto market, including Bitcoin, to experience a brief correction and then rise again and even surge.
