Markets
Is Trump Good for Bitcoin? Analysts Say So Despite Past Stance on ‘Scams’
Top line
The “Trump factor” is a positive catalyst for the world’s largest cryptocurrency, bitcoin, Bernstein analysts said in a note to clients Tuesday, as Donald Trump’s selection of the crypto-friendly Ohio senator, JD Vance while his running mate has further fueled optimism among bitcoin investors about the prospect of self-proclaimed “Crypto President” Trump, despite Trump’s previous dismantling of bitcoin.
Donald Trump, left, and JD Vance are running on a pro-cryptocurrency ticket.
Los Angeles Times via Getty Images
Highlights
“The crypto market is interpreting a Trump victory scenario as more positive for cryptocurrencies,” and the price of bitcoin is “positively correlated with the probability” of a Trump presidency, according to Bernstein analysts led by Gautam Chhugani.
Bitcoin has risen about 10% to nearly $65,000 since the assassination attempt on Trump on Saturday, which then boosted his chances of winning the November presidential election. according to to betting markets, which are an imperfect real-time proxy for vote changes, although most Recent polls also suggest Trump has a slight lead over Biden.
Bitcoin will continue to be “sensitive” to elections, predicts Chhugani, who has a very optimistic price target of $200,000 for bitcoin by the end of 2025.
Chhugani, who noted that “the Biden administration’s strong regulatory crackdown on crypto and Trump’s pro-Bitcoin statements” are fueling bitcoin optimism, is the latest analyst to view another Trump presidency as a tailwind for crypto, joining Standard Chartered analyst Geoffrey Kendrick, who predicted Bitcoin could hit $150,000 if Trump wins, Conotoxia analyst Grzegorz Dróżdż, who said This would have a “positive impact” on cryptography in general.
Among the reasons Trump is seen as more pro-crypto is his support for domestic bitcoin mining, the energy-intensive process of extracting new bitcoins from the digital blockchain that Biden has propose levying a significant tax on, and its opposition to digital currencies issued by central banks that may threaten the value of existing digital tokens like bitcoin.
The nomination Monday of Vance, a longtime cryptocurrency ally, as Trump’s vice presidential pick likely bolstered Trump’s push, as Vance owned at least $100,000 worth of bitcoin as of his nomination date. most recent financial disclosure and a Many times boasted less sector regulation.
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Key context
Ahead of this election cycle, Trump has repeatedly criticized bitcoin and promoted tighter regulation. “I’m not a fan of bitcoin and other cryptocurrencies, which are not money and whose value is very volatile and based on nothing,” and “unregulated crypto assets can facilitate illegal behavior,” Trump said. wrote on X in 2019. Other reviews included saying Bitcoin ‘looks like a scam’ in 2021. Trump quickly turned to crypto, sale millions of dollars worth of its own branded non-fungible tokens (NFTs) starting in 2022, and its campaign has begun accepting cryptocurrency donations, bringing $1.8 million in bitcoin contributions in Q2 2024, declarant He is “very positive and open-minded toward cryptocurrency companies and anything related to this new and growing industry” in May. Several notable figures in the cryptocurrency industry have endorsed Trump, including billionaire twins Cameron and Tyler Winklevoss, who deplored that Biden “openly declared war on crypto” in his June promise to donate $1 million each in bitcoin to Trump’s election efforts.
Contra
Despite the cryptocurrency market’s apparent support for a presidential regime change, bitcoin has scored several major victories under Biden. Since Election Day 2020, bitcoin has risen nearly 400%, from around $14,000 to nearly $64,000. More significantly, Biden-appointed financial regulators approved the first-ever bitcoin cash exchange-traded funds in January, sparking billions of dollars of institutional investment in bitcoin. Much of the crypto community’s criticism of the Biden administration has focused on Securities and Exchange Commission Chairman Gary Gensler, who has often been criticized for his lack of credibility. critical space. Part of Gensler’s regulatory crackdown includes breaking up bad actors like failed crypto exchange FTX, whose founder Sam Bankman-Fried is in the middle of a 25-year prison sentence and the Federal Bureau of Investigation find Americans lost an estimated $3.94 billion to cryptocurrency investment fraud in 2023, a 53% increase year-over-year.