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Since the launch of Bitcoin in 2009, cryptocurrencies have repeatedly been heavily influenced by political regulations. Therefore, it could be of crucial importance for crypto investors whether Kamala Harris or Donald Trump wins the US election.
One of the most significant trends in current U.S. politics is the increasing acceptance of cryptocurrencies across the political spectrum. This shift is particularly pronounced as the U.S. presidential election approaches, potentially marking a pivotal moment for digital currencies in the country.
Trump presents himself as a crypto advocate
The Republican Party has clearly moved towards a crypto policy and is pro-crypto. Former President Donald Trump in particular has proven to be a surprising supporter of the cyber currency industry in the current election cycle .
According to MarketWatch, Juan M. Villaverde, a crypto and cycle analyst at Weiss Ratings, suspects that Trump’s “America first” ideology is expressed in the desire to see the US crypto industry flourish and reverse the ostracism it has faced in recent years. Trump has repeatedly stressed that the US must become more crypto-friendly in order to put an end to the departure of many growth-boosting crypto companies abroad. He recently even described the US as a “crypto superpower”. Whether the ex-president is serious about his pro-crypto stance – or whether he is simply trying to win votes from US crypto supporters – remains to be seen.
Uncertainty in the Democrats’ stance on cryptocurrencies
While the Republican position on cryptocurrencies has become clearer, the Democratic Party’s approach remains less clear. US Vice President Kamala Harris, the Democratic presidential candidate, has expressed a desire to “re-engineer” relations with the crypto industry – but no concrete measures have been formulated yet. The choice of Tim Walz as Harris’s vice presidential candidate adds to the current uncertainty, given his cautious stance on cryptocurrencies and his focus on social rather than economic issues.
Villaverde sees a great deal of uncertainty regarding the Democratic Party’s stance on Bitcoin, Ethereum & Co. “If the Democrats win, it will of course remain a mystery how they will approach the crypto economy. I think we are seeing steps towards a ‘reset’ of relations, as Kamala Harris said, but the fact that we have not seen any concrete measures gives me pause.” This lack of clarity is worrying for many in the crypto community, as the future of crypto regulation in the US remains uncertain under a possible Democratic administration. For this reason, some crypto investors see a Harris election victory as more of a threat.
Crypto rally expected after US election – unless…
Looking ahead, analysts predict a significant rise in the cryptocurrency market after the US elections in November – regardless of whether Trump or Harris wins. Bruce Ng, a senior crypto analyst at Weiss Ratings, expects a broad crypto rally starting in November: “Elections usually clear out speculative uncertainty in the market, so we will see a serious ‘moonage’ [i.e. a price increase] after the November elections,” MarketWatch quoted him as saying.
However, there are still potential pitfalls, especially if the Democrats win and Gary Gensler remains head of the SEC. This could lead to short-term volatility on the crypto front. Despite these risks, the longer-term outlook for cryptocurrencies is likely to be good, according to Ng. Expected rate cuts by the Federal Reserve, the maturation of crypto ETFs, and changing generational attitudes – crypto-friendly views are particularly common among Generation Z (usually defined as those born between 1995 and 2010) – all point to continued growth and growing crypto adoption in the coming years.
Importance of the cryptocurrency sector is increasing in the USA
As the US election approaches, the crypto community remains vigilant, aware that the political landscape could significantly influence the future of the industry. The sheer number of Americans invested in cryptocurrencies – an estimated 50 million – underscores their importance as a key voting bloc. “Whether out of political expediency or genuine belief in the technology’s potential, both parties will likely need to engage more directly with cryptocurrencies as they continue to become a central part of the global financial ecosystem,” writes Jurica Dujmovic on MarketWatch. Regardless of the outcome, the post-election period will be a time of change for the crypto market, with opportunities and challenges on the horizon.
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