Bitcoin on the U.S. Election Scene

Bitcoin (#BTC☀ ) first emerged over three election cycles ago. However, the 2024 election marks the first time that Bitcoin and #Cryptocurrencies in general are nearing the point of becoming a major campaign issue. Advocates of #Bitcoin❗ , inspired by Satoshi Nakamoto's white paper, have become an influential group of single-issue voters. While this movement has faced setbacks due to the bear market and scandals like the collapse of FTX, recent trends have shifted in favor of crypto and its supporters. Bitcoin prices remain stable, and institutions like BlackRock have declared Bitcoin as the store of value for this generation. As the election race heats up, the question now is: What role will Bitcoin play in shaping the future of the world's largest economy?

Economic Challenges and Bitcoin's Potential

According to the U.S. Federal Reserve, by 2024, the dollar will retain only 3% of its original purchasing power, leading many developing countries to explore alternatives to the dollar. There are also concerns that current monetary policies aimed at preventing a recession could lead to hyperinflation and economic downturn. The economy swings between periods of growth and risk, deepening the wealth gap between the rich and the middle class. Bitcoin is often viewed as a hedge against this economic instability, and for many, it represents hope for financial independence. However, the dollar still dominates the global economy, despite its declining purchasing power.

Predictions for Bitcoin in the 2024 Election

In this context, here are four bold predictions for how the 2024 presidential election could impact Bitcoin and cryptocurrency in the United States:

1. Gensler May Leave Regardless of Election Outcome
   Securities and Exchange Commission (SEC) Chairman #GaryGensler has made few friends in the crypto community since taking office. While he has had some notable victories, his enforcement-based approach has also faced losses in court. Donald Trump has promised to "fire" Gensler if elected, but SEC chairs usually step down when a new president takes office. Even if Kamala Harris wins, her administration might take a similar stance to appeal to the crypto industry. Change is in the air.

2. Harris Victory Could Benefit Bitcoin, Trump Victory Could Favor Ethereum
   Under a Harris administration, which would likely continue current monetary policies, the crypto market could remain stable, and Bitcoin could see growth. In contrast, a Trump victory might bring incentives for crypto companies to set up in the U.S., boosting Ethereum and decentralized finance (DeFi), which largely operates on the Ethereum network.

3. Harris Administration Could Introduce a Crypto-Specific Capital Gains Tax
   If Harris wins, her administration may introduce a capital gains tax specifically for cryptocurrencies. With the amount of capital flowing into crypto, it's unlikely the government would pass up the opportunity to take a share as digital assets integrate with traditional finance. On the other hand, higher taxes seem less likely under Trump, who has positioned himself as an ally to the crypto industry.

4. Trump Could Release a Formal Plan for Bitcoin and Digital Assets
   While Harris has remained largely silent about digital assets during her campaign, #donaldtrump has actively courted the crypto vote. He was the first U.S. president to attend a Bitcoin event in Nashville, where he famously declared that Bitcoin’s future belongs in the U.S. and vowed to keep Elizabeth Warren and her allies away from Americans' Bitcoin. If formal crypto policy is announced before the election, it will most likely come from Trump's campaign.

Conclusion

Change often takes longer than expected and happens differently than planned, and Bitcoin is no exception. While Bitcoin holds the potential to bring about major transformations, the current institutions that hold power will resist because they stand to lose the most if the fundamental principles of Bitcoin and cryptocurrencies are fully realized.

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,,The information and views presented in this article are intended solely for educational purposes and should not be taken as investment advice in any situation. The content of these pages should not be regarded as financial, investment, or any other form of advice. We caution that investing in cryptocurrencies can be risky and may lead to financial losses.“