2024 US Election Finally Here: Here’s What to Expect for Crypto

The crypto market has weathered two major US election cycles with fairly consistent outcomes in the long-term.

Man with the USA flag seeing how it affect the crypto market.
Created by Kornelija Poderskytฤ— from DailyCoin
  • Election Day in the US is finally here.
  • The crypto market has weathered two major US election cycles with fairly consistent long-term outcomes.
  • Analysts remain optimistic heading into 2024 polls.

After months of anticipation, heated debates, and speculation, US Election Day is finally here. With several industry leaders touting the polls as a make-or-break moment for crypto, the space has been rife with speculation about how the markets will perform afterward. To attempt to answer this, however, it is worth looking at the market’s historical performance after the elections.

Crypto’s History with US Elections

So far, the crypto market has survived two major US election cycles with fairly consistent outcomes, as recently highlighted in a note by prominent crypto analytics platform Santiment Feed.

The 2016 US Election

The 2016 US presidential election was held on November 8 and resulted in the election of Donald Trump. Following the announcement of the result on November 9, the crypto market experienced a minor 5-day correction with an approximately 5.5% decline for Bitcoin specifically. Santiment Feed attributed this decline to the perceived unknowns of what a Trump presidency would look like, as he had not held any prior public office. 

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market reaction following election of Trump
Chart showing market reaction following the election of Trump
Source: Santiment Feed

However, the market losses were quickly erased as Bitcoin surged by over 7% just the week after. This rally will continue, and Bitcoin will surge from below the $1,000 price point to near the $20,000 price point by the end of December 2017.

The 2020 US Election

The 2020 US presidential election was held on November 3, 2020, and Joe Biden was elected. Unlike the 2016 polls, which took only one day, the 2020 election results were confirmed in four days. However, from a crypto price action perspective, the outcome was broadly the same.

market reaction following election of Joe Biden
Chart showing market reaction following the election of Joe Biden
Source: Santiment Feed

Following a nearly 5% decline on the day of the result announcement, the crypto market took off on a blistering rally that, like in 2016, culminated in new all-time highs a year later, with the asset clinching the $69,000 price point in November 2021.

As the 2024 US Election Day kicks off, analysts remain optimistic about similar outcomes regardless of the result, despite narratives that a Vice President Kamala Harris win over former President Donald Trump would be harmful to crypto.

More or Less The Same Outcome?

In a note shared with DailyCoin on Saturday, November 2, 10x Research CEO Markus Thielen argued that while there was likely to be short-term volatility after the election, the crypto marketโ€™s trajectory was unlikely to be affected.

โ€œCrypto (Bitcoin, Ethereum, Solana) could be up +5% if Trump wins, Bitcoin might be down -9% if Harris wins, and Solana -15%. Hence, a long Bitcoin vs. short Solana could be a reasonable election trade. However, it's essential to emphasize one crucial point: the current Bitcoin bull market of 2023/2024 (and potentially 2025) has more substantial factors at play. It's doubtful that investors bought Bitcoin over the past six months based on expectations of Trump becoming President,โ€ the note read.

Thielen is not alone in his view. Speaking to DailyCoin, CoinShares Head of Research, James Butterfill, expressed similar sentiments.

โ€œThe data makes it very clear that the US elections is likely to have a very polarising impact on Biitcoin prices, with a Republican win likely to prompt a rally that break past the US$73K all time high, with a Harris win seeing Bitcoin falling to $60K mark. We do not believe a Democrat win will be longer term negative for prices as Harris has expressed a more constructive note on Bitcoin than many believe,โ€ the analyst stressed.

The 2024 US election cycle has seen more interest from the crypto industry than any election before. According to Follow the crypto data at the time of writing, crypto-focused PACs have raised nearly $200 million and have already spent over $130 million to support campaigns. The increased political interest comes as the industry claims to have come under attack during the Biden administration amid a barrage of enforcement actions from the Gary Gensler-led SEC.

On the Flipside 

  • Beyond the election, investors should also monitor the outcome of this week’s Federal Open Market Committee (FOMC) meeting.

Why This Matters

The US election result will likely have significant implications for crypto regulation over the next four years.

Read this for more on the crypto market:
Crypto Market Idles in Likely Calm Before Election Day, FOMC Storm

Learn more about OpenSea’s teased revamp:
New OpenSea Platform Teased for December 2024: What We Know

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Okoya David

David Okoya is a journalist at DailyCoin covering DeFi ecosystems and exchanges. David has moderate holdings in Bitcoin, and minor holdings in LINK, DOT, INJ, and memecoins.

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