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October 1, 2024Bitcoin’s Future: How the Upcoming U.S. Presidential Election Could Influence Prices
As the 2024 U.S. presidential election approaches, Bitcoin’s price is poised to benefit, irrespective of which candidate emerges victorious. CK Zheng, chief investment officer at ZX Squared Capital, believes that the ongoing discourse—or lack thereof—around rising U.S. debts and deficits is bullish for Bitcoin. He shared his insights with Cointelegraph, emphasizing that both major parties have failed to adequately address these financial issues, which could enhance Bitcoin’s appeal post-election.
Historical Trends and Upcoming Events
Zheng pointed out that Bitcoin has historically thrived during election years, particularly during uncertain times. With April’s halving event, a phenomenon that has historically led to significant price rallies, Bitcoin is likely to follow a similar pattern in the fourth quarter of this year. According to CoinGlass data, Bitcoin has surged over 50% six times since 2013 in Q4, with halving events often amplifying these gains. For instance, during the 2020 halving, Bitcoin experienced a remarkable 168% rally in Q4, coinciding with the last U.S. presidential election.
Zheng predicts that Bitcoin could reach a new all-time high by the end of the year or shortly thereafter.
While the prospect of price rallies is exciting, Samantha Yap, CEO of Web3 PR firm YAP, notes that the real significance lies in the surge of retail interest that typically follows. “What matters is the increase in retail engagement across the crypto industry,” she explained. This influx of interest often attracts media attention, sparking a frenzy that can further drive market dynamics. The hope is that there are enough usable and accessible applications ready to onboard newcomers into the crypto space.
The Impact of Federal Reserve Policies
Zheng also highlighted the potential impact of the Federal Reserve’s monetary policy. An aggressive 50 basis point interest rate cut could be bullish for Bitcoin and other risk-on assets, particularly if the U.S. economy achieves a “soft landing.” This term refers to the delicate balancing act central banks perform—preventing economic overheating while avoiding a recession.
If the Fed succeeds, Zheng anticipates a close correlation between Bitcoin’s price and the NASDAQ, as liquidity gradually returns to the market. Leo Fan, a founder of zero-knowledge proof generation and verification layer 1 Cysic, added that Bitcoin’s narrative as “digital gold” and a hedge against macroeconomic instability is likely to attract more institutional investment, especially in a volatile traditional market.
As of now, Bitcoin is trading at approximately $64,400, experiencing a 2% decline over the past 24 hours. However, the broader context suggests that favorable conditions could be on the horizon, positioning Bitcoin for potential growth in the coming months.
