According to CoinDesk: Bitcoin surged above $68,000 before settling around $67,500 during early Asian trading hours on Monday, driven by positive U.S. election predictions following President Joe Biden's announcement that he will not run for re-election. The broader crypto market, as represented by the CoinDesk 20 index, saw a 1.25% increase.
Key Developments
President Biden’s decision not to contest the upcoming election is seen as potentially favorable for the digital asset industry, regardless of the election outcome. This news has sparked bullish sentiment among traders and has driven significant gains in the cryptocurrency market.
Market Reaction
Bitcoin (BTC) briefly rose above $68,000 before stabilizing at $67,500. Major cryptocurrencies also experienced gains, with Ether (ETH) crossing $3,500, Cardano’s ADA and Solana’s SOL rising by up to 5%, and dogecoin (DOGE) jumping more than 8% before paring gains. The CoinDesk 20 (CD20) index, which tracks the largest crypto tokens minus stablecoins, rose by 1.25%.
Election Impact
Biden’s announcement dropped the odds for Republican candidate Donald Trump from 71% on Sunday to 65% on Monday morning on the crypto betting platform Polymarket. Meanwhile, the odds for Vice President Kamala Harris rose from 16% to 30%.
“Biden’s withdrawal has opened up a possibility where, regardless of who sits in the White House, the U.S. government could embrace a more constructive stance towards the digital asset industry after November,” stated Singapore-based crypto research firm Presto in a note to CoinDesk. “Whether Harris or any other contenders will pursue such a path remains to be seen, but the optionality that hardly existed before is now there,” Presto added.
Industry Sentiment
Trump’s favourable view of cryptocurrencies has garnered significant support from industry players. He is scheduled to speak at the Bitcoin 2024 conference in Nashville later this week, further boosting market sentiment.
“We would expect the market to rally higher as Trump's key economic policy would be a lower interest rate and cheaper borrowing costs. This would surely boost all risky assets, including BTC,” shared Lucy Hu, senior analyst at Metalpha, in a Telegram message. “In the mid-long term till the 2025 election, we would expect BTC to continue to rally,” Hu added.
