Coin World Report:
In the past seven days, Bitcoin has surged by about 13%, and some investors see this surge as a signal of market expectations for Donald Trump, the Republican candidate who is pro-cryptocurrency, to win the U.S. presidential election.
This increase in digital assets far exceeds global stock indices and gold. Billionaire Stan Druckenmiller pointed out that cryptocurrency is one of the market’s predictions of Trump’s victory.
In a tense campaign against his Democratic opponent, Vice President Kamala Harris, Trump promised to make the United States the global capital of cryptocurrency. His support for the industry has made Bitcoin seen as one of the “Trump trades,” a series of bets based on his return to the White House.
Bitcoin leads other assets in October
Bitcoin’s surge accompanies changes in the prediction market, which allows people to bet on election results. On the Polymarket platform, Trump’s probability of winning has jumped to 58%, while Harris has dropped to 41%. On PredictIt, Trump’s chances of winning are 54%, while Harris is at 49%.
ETF inflows:
“The heat of the prediction market has brought high levels of implied volatility, while driving up the spot price of Bitcoin,” said Arisa Toyosaki, co-founder of Cega, a cryptocurrency derivatives service provider. “Recently, a large amount of funds has flowed into Bitcoin exchange-traded funds (ETFs), which has also driven up the price of Bitcoin.”
Since October 11, a group of U.S. ETFs that flow into Bitcoin exchange-traded funds (ETFs) has exceeded $1.6 billion. As of Thursday, the price of Bitcoin was about $67,260, while the historical high in March was $73,798.
Although the prediction market leans towards Trump, the gap in most polls is still within the margin of error, less than three weeks before the election day. According to the average data of national polls by Real Clear Politics, Harris leads Trump by about 1.6 percentage points. In the average data of key states, Trump leads by less than 1 percentage point.
Harris’ stance:
Harris takes a more cautious stance on cryptocurrency issues, promising to support the regulatory framework and industry development of digital assets with appropriate safeguards. Her position contrasts with the crackdown by the Biden administration, which has sparked optimism among cryptocurrency traders.
Meltem Demirors, a general partner at Crucible Capital, said, “The emergence of cryptocurrency as an election issue has sparked attention to Bitcoin and the broader category of crypto assets. This attention has translated into market sentiment, and as we know, sentiment often triggers capital flows.”
It is worth noting that Trump once called cryptocurrency a scam, but now his attitude towards the industry has changed significantly. Digital asset companies have become an important force in this election by making large donations to political action committees and seeking more friendly regulatory rules.
In an interview with Bloomberg TV on Wednesday, Druckenmiller said that the market has been “very convinced” in the past 12 days that Trump will win. “You can see this from the performance of bank stocks and cryptocurrencies,” he said.