How will the US elections affect the cryptocurrency market?
Analysts are warning of further market volatility due to possible delays in US election results. Traders are cautious, and bitcoin is still trying to reach new levels. What to expect from the crypto market in the face of political risks?
What are the critics saying?
As the election of the next US president approaches on November 5, there is high uncertainty in the markets, and as a result – uncertainty. Bitcoin recently almost broke its price record The price reached $73,750, but this did not affect the crypto market much. Investors are afraid to take any important steps because of the uncertainty.
Morgan Stanley analysts warned. The report said that volatility in financial markets could increase due to delays in the counting of votes, economic uncertainty and unpredictable behavior of voters.
“The delay in the announcement of election results creates a period of uncertainty and speculation, which historically leads to increased levels of short-term market volatility. Due to narrow margins of victory in some countries, we expect that the delay may take days or even weeks”, – the report says.
Pav Handal, chief analyst of Swyftx, expects the crypto market to slow down significantly after the US elections.
Some experts suggest that bitcoin may go down in the short term, but it will not be significant. And it could reach an all-time high this week. Maria Carola, CEO of StealthEX crypto exchange predicted the price of BTC at $73,680 in the coming days.
“When the correction test at the support level of $70,020 failed, bitcoin began to move to $73,860, which it can reach at the end of the week,” he said.
Chief Investment Officer of Maelstrom Investment Fund, American businessman, co-founder and former director of BitMEX crypto exchange Arthur Hayes hedges
Opening transactions in one market reduces the impact of price risks of the same but different level in another market. choosing risks using USDe stablecoin from Athena LabUSDe is a synthetic stablecoin that tries to maintain its value at the level of 1 US dollar using a special system that uses other stablecoins and special trading methods.while saving more bitcoin (BTC), ethereum (ETH) and other cryptocurrencies.
Hayes reported to CoinDesk that Maelstrom holds 5% of its assets in USDe (Ethena USD) with a yield of about 13%. This synthetic stablecoin maintains a 1 to 1 peg through an arbitrage strategy, including trading futures related to BTC and ETH.
The businessman predicts that if the elections go ahead without civil unrest, the markets could go higher. In this case, Maelstrom plans to transfer all sUSDe assets to cryptocurrency. If unrest breaks out, it can lead to temporary price fluctuations for risky assets, including cryptocurrencies.
Bitcoin and gold have a reputation as hedging assets against currency shortages and inflation. However, if Trump wins, he is likely to focus on tax breaks and legislative cuts without reducing public spending.
At the same time, Hayes believes that regardless of who wins, both candidates will continue to issue new money in large quantities, which will only help cryptocurrencies.
It is interesting that in a recent episode of the podcast with the famous entertainer Joe Rogan, the candidate for the presidency of the United States Donald Trump did not talk about cryptocurrencies or bitcoin, a topic that many expected to hear . Rogan, who has spoken positively about bitcoin and NFTs, didn’t ask about it.
One reason could be the recent failure of Trump’s crypto project called World Liberty Financial. Despite its successful operation, the project ran into problems, and only a small portion of the WLFI tokens were sold. This may influence Trump’s reluctance to discuss cryptocurrencies, especially because of the criticism of the centralization and opacity of the World Liberty Financial project.
The results of the US election will determine the fate of Memecoins
Columbia Business School Professor Omid Malekan believes that the memcoin sector could be greatly affected by Trump’s victory in the US presidential election. He suggested that financial interest in memecoins is increasing due to frustration with the unfair tokenization of other projects supported by venture capitalists.
However, many disagree with Malekan’s views. Famous trader Murad Makhmudov thinks that “memes” coins are independent from the strategy. According to him, the growth of the sector is influenced by the increase in financial capital worldwide: it exceeded $ 107.1 trillion, and the annual growth rate is 7%. The revenue of the memecoin sector has reached $57 billion.
Anatoliy Yakovenko, co-founder of Solana LabsThe most popular blockchain for memecoins.he believes that trading in such tokens is very entertaining.
«Memcoin business – it’s entertainment. It’s a Keynesian beauty contestFrom a Keynesian perspective, aggregate demand is not necessarily equal to the productive capacity of the economy. where people choose the funniest thing. Selling everything else is work. In that case, people will want to work a little», answered Malekan.
Opinions are “for” Trump
According to the predicted market Polymarket. As of October 31st, Trump has had the most votes. 65.3% of people are ready to vote for him, while -34.8% are ready to vote for Harris. This is what the distribution looks like in the graph below.
One of the so-called “whales”, that is, the big players in the market, is so confident in the victory of the Republican leader that he spent $ 8.6 million by betting on Polymarket on the victory of Trump in the last 7 days.
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