Bitcoin and Memecoins Surge Amid Early Election Results as Trump Takes the Lead

Bitcoin briefly rallied by over 3%, reaching highs of $71,500 as the cryptocurrency market responded to Donald Trump’s early lead in the 2024 U.S. presidential election. However, the price retraced slightly to $71,309 at the time of writing, according to TradingView data.

The surge in Bitcoin’s price comes as Trump is currently leading Kamala Harris in the electoral college by a wide margin, with 95 electoral votes to Harris’s 35. This early election result has caused heightened volatility across financial markets, particularly within the crypto space.

While Bitcoin showed a solid rally, memecoins like Dogecoin (DOGE) and Shiba Inu (SHIB) surged even higher. DOGE spiked by 5%, and SHIB increased by 3% within the same timeframe. Other major cryptocurrencies also showed gains, including Ether (ETH), which rose 1.9%, and Solana (SOL), up 2.6%, according to CoinGecko data.

The rally in Dogecoin is likely linked to the ongoing support from Elon Musk, who has voiced backing for Donald Trump. Musk’s influence continues to drive interest in DOGE, particularly as he remains aligned with Trump’s political movements, such as the “Department of Government Efficiency” aimed at reducing government spending.

Crypto Market Volatility Ahead

Bitcoin and other crypto assets have been highly volatile in the lead-up to the election, with the price of Bitcoin initially falling 2.4% to a local low of $68,755 earlier in the evening. Despite this, Bitcoin remains up over 2% over the last 24 hours, while memecoins DOGE and SHIB are up 11.2% and 8.5%, respectively.

As election results roll in, experts expect this volatility to continue. One trader has forecasted that Bitcoin could experience a price swing of at least 10% in either direction once the election is fully called, a prediction based on the market’s reaction to Trump’s current lead.

According to Bitfinex analysts, the heightened volatility could lead to “big moves” in the crypto markets, or alternatively result in a “much deeper correction” for Bitcoin, depending on the broader election outcome. As vote counting continues in key states, the markets remain on edge, awaiting final results that could have significant implications for the financial landscape.

The volatility index for Bitcoin, which measures forward-looking price fluctuations, reached a three-month high of 65.7 on November 3. Since then, the index has dropped slightly to 63.8 at the time of publication. These numbers reflect the market’s sensitivity to the election and the potential for sudden price movements.

As polls close in eight states, Trump continues to lead Harris with 23 electoral votes to her 3, according to the latest figures from the Associated Press. The race could take several days to fully resolve due to tight margins in swing states, which may require recounts. This prolonged uncertainty is likely to keep the market on edge.

Federal Reserve’s Role in Volatility

Adding to the volatility, the U.S. Federal Reserve’s Federal Open Market Committee (FOMC) meeting scheduled for November 7 could further impact markets. Current forecasts suggest a 94.1% chance that the Federal Reserve will cut interest rates by 25 basis points, a move that could have broader implications for the U.S. economy and financial markets. The possibility of interest rate cuts could influence investor sentiment, potentially leading to greater market fluctuations in the coming days.

As the election results unfold and the Fed’s policy decisions loom, crypto traders and investors are bracing for further price swings. For now, Bitcoin, Ether, and memecoins like Dogecoin and Shiba Inu are in a heightened state of volatility, with more big moves likely in the hours and days ahead.

The combination of political uncertainty, fluctuating market sentiment, and potential changes in monetary policy could create a perfect storm for the crypto market, with both risks and opportunities on the horizon. Crypto enthusiasts will be watching closely as the 2024 U.S. election continues to impact financial markets across the globe.