As a seasoned crypto investor with over a decade of experience navigating the ever-evolving digital asset landscape, I find myself intrigued by the recent surge in cryptocurrency markets following Donald Trump’s victory in the 2024 United States presidential election. The HTX Ventures report published by CryptoMoon Research sheds some light on the factors contributing to Bitcoin and cryptocurrency’s role in this election, which I find both fascinating and informative.
After Donald Trump’s triumph in the 2024 U.S. presidential election, there was a noticeable increase in the cryptocurrency market, as numerous people believed his victory would have substantial implications for the sector. CryptoMoon Research, in collaboration with HTX Ventures, recently released a report that delves into the factors driving Bitcoin and cryptocurrencies’ influence on the election outcome. The report also discusses how presidential elections might shape future policies, adjust market perceptions, and possibly affect crypto businesses in the coming years.
How crypto became a key issue this election season
Year after year, the interest in cryptocurrencies within the United States grows significantly. This current year has been particularly remarkable, with some pivotal crypto events that have left a lasting impact on crypto history. As a result, crypto has become one of the main points of discussion during the election cycle, raising important concerns and influencing political debates and campaigns.
As a researcher examining the economic landscape, I’ve observed that the macro perspective presents some challenging signs. The current U.S. fiscal policies seem to be steering us towards an expanding federal budget deficit, which in turn could escalate the U.S. federal debt. This potential growth in budgetary imbalances and debt loads might create turbulence within financial markets.
Bitcoin (BTC) is considered useful for protecting one’s assets from inflation, particularly beneficial for people who are finding it harder to make ends meet due to rising costs. Being a decentralized and limited resource, it offers possible tactical importance when dealing with debt and inflation issues.
The surge in popularity of cryptocurrencies can be attributed, in part, to the rise of stablecoins. Despite being introduced just a decade ago, stablecoins now rank among the top 20 holders of U.S. Treasury securities, outstripping financial giants like Germany. This indicates that stablecoins have come to play a significant role within the U.S. financial system by buying up substantial amounts of Treasury securities, thereby providing extra liquidity support for the economy.
As a researcher, I’ve uncovered an intriguing trend: the enthusiasm among voters towards cryptocurrencies is clearly on the rise. A nationwide survey, commissioned by Grayscale and carried out by The Harris Poll, revealed that over half of the respondents expressed a stronger preference for a candidate who demonstrated knowledge about crypto, compared to one who did not.
Concurrently, there’s been a significant rise in cryptocurrency curiosity among voters in crucial states. Following the 2020 election, Pennsylvania and Wisconsin, two closely contested states, moved up to fourth and fifth place in terms of Google searches related to cryptocurrency.
The election’s impact on crypto
Throughout his election campaign, Trump displayed a keen enthusiasm towards the digital asset sector, proposing ambitions to turn the United States into “the leading global hub for cryptocurrencies” and “a dominant force in Bitcoin.” He advocated for Bitcoin mining and promised to uphold individual custody rights. Remarkably, he also treated his supporters to burgers paid for with Bitcoin during his campaign. Moreover, Trump was vocal about his disapproval of the Securities and Exchange Commission’s tough stance on cryptocurrencies, expressing his intention to appoint a pro-crypto chair if reelected.
Trump put forward several suggestions regarding cryptocurrency policy, such as setting up a Strategic Reserve for Bitcoin, creating a Presidential Advisory Council on Cryptocurrencies, and preventing the Federal Reserve from launching its own digital currency. Explore further details in our comprehensive report.
Regardless of the hopeful assurances given during the election period, it could take a significant amount of time for those promises to be realized, or they might not happen at all because of their high implementation costs. However, it’s clear that the election has had an influence on the cryptocurrency market.
Election forecasts found a significant advantage with prediction markets. Among these, Polymarket, a pioneer in this sector, accounted for approximately 80% of the bets placed on the presidential election. Operating within a blockchain environment, Polymarket outperforms traditional market players and boasts the largest market share, a feat that is quite uncommon.
Polymarket initially attracted a solid user base by providing an easy-to-use market platform and implementing a strategy that was both socially advantageous and free from ethical dilemmas, which ultimately led to mainstream acceptance. Furthermore, Polymarket’s data has been widely utilized by numerous mainstream media platforms, including Bloomberg Terminal, which started incorporating Polymarket data into its panels as early as August. The success of Polymarket inspired other Web3 protocols to create their own betting tools.
Beyond prediction markets, decentralized finance (DeFi) could become integrated into traditional financial systems due to positive shifts in the broader economic landscape. Among DeFi platforms, BTCFi is particularly noteworthy for its ability to foster agreement and credibility quickly, establishing a robust base for its continued evolution. Following Donald Trump’s election, companies specializing in Bitcoin financial solutions will find motivation and benefit from a more lenient regulatory climate, further cementing Bitcoin’s status as a cornerstone asset.
A potential shift under a Trump administration could result in a more transparent regulatory structure and a less restrictive climate, potentially attracting crypto firms back to the U.S. and making it possible for them to serve U.S. customers once again. Furthermore, as reported by Bloomberg, companies such as Circle Internet Financial, Kraken, Fireblocks, Chainalysis, and eToro are considering going public in the coming years, with other suitable crypto firms also anticipated to follow suit via traditional initial public offering (IPO) processes.
This post serves as a source of broad knowledge and isn’t meant to serve as legal or financial guidance. The perspectives, ideas, and opinions shared by the author may not align with those held by CryptoMoon.
In plain terms, CryptoMoon doesn’t back the information in this article nor any goods discussed within it. It’s essential for readers to conduct their own investigations prior to engaging with any product or business mentioned here, as they will be solely responsible for their choices.
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2024-11-07 20:58