How Crypto Investors Are Preparing for US Election 2024?

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As a seasoned analyst with over two decades of experience in financial markets and politics, I find myself deeply intrigued by the intertwining of these two worlds – particularly in the context of the 2024 Presidential Election and its impact on cryptocurrencies.

With the 2024 Presidential Election drawing near and intensifying, the attention-catching emergence of cryptocurrencies tends to eclipse the escalating impact and readying of crypto investors and lobbyists, as well as their financial backing for the upcoming Congress.

Given that more than $160 million has been invested so far during this electoral period, it’s reasonable to anticipate an increase in legislators with pro-crypto leanings from both political parties in both houses.

Many candidates running for House seats are likely to strengthen the pro-cryptocurrency voting faction. This group could provide crucial backing for an industry that has predominantly found itself on the defensive under the administration of President Biden and SEC Chairman Gary Gensler.

Crypto Investors Bet on Trump Win, Brace for Bitcoin Volatility

People investing in crypto are buying Bitcoin-focused funds, hoping for a Trump comeback and expecting Bitcoin to be unpredictable around the election timeframe.

On Wednesdays, it was noted that Bitcoin-tracking ETFs experienced a significant increase in investments, with an inflow of approximately $917.2 million – the largest daily surge since March.

On its launch day in January, BlackRock’s iShares Bitcoin Trust ETF attracted an impressive $872 million, making it the largest single-day inflow since its creation. This has propelled it to become the leading Bitcoin fund in terms of assets under management. Over the past week, the fund recorded a total inflow of $2.2 billion, outperforming 13,227 similar funds worldwide. In October alone, Bitcoin experienced a surge of 13.6% as speculation about Donald Trump’s potential re-election bid as a pro-crypto candidate gained traction.

Analysts at Ryze Labs expressed enthusiasm about potential pro-cryptocurrency laws in Congress, as they anticipate a stronger representation of Republicans post-election, which they believe could be more favorable to crypto regulation.

Although surveys indicate that the contest between Trump and Democrat Kamala Harris is closely matched, wagering platforms like Polymarket predict a greater likelihood of Trump’s victory. This discrepancy has led to apprehension regarding the election outcome, as well as anticipation for an unpredictable election week. Furthermore, Bitcoin volatility data from Deribit suggests that its price may fluctuate by approximately 3.7% daily until November 8th.

Crypto Community Eyes Influence in 2024 Election Amid Regulatory Battle

In simple terms, there’s a disagreement between the cryptocurrency community (which includes various startups and investors) and the federal government about whether cryptocurrencies should be considered as financial assets and who should regulate them – either the Securities and Exchange Commission (SEC) or the Commodity Futures Trading Commission (CFTC).

2024 saw a significant increase in the political clout of cryptocurrency enthusiasts, as approximately half of all corporate donations towards federal election campaigns originated from supporters of digital currencies. As per the advocacy group Public Citizen, crypto businesses and high-profile crypto investors have contributed over $119 million directly into federal elections this year.

Although Trump has been openly supportive of cryptocurrencies and even initiated his own crypto project, Harris has adopted a more impartial approach towards the sector. Contrastingly, the Biden administration, particularly under SEC Chairman Gary Gensler, has enforced a stringent regulatory policy that many within the cryptocurrency community view as unfriendly.

Currently, Harris seems receptive to interacting with the cryptocurrency community. It’s been reported that Chris Larsen, Ripple‘s co-founder and chairman, has donated over $11.8 million to PACs backing her candidacy. Within the sector, there’s much speculation about who might take Gensler’s regulatory role. Both Larsen and Ripple executive Brad Garlinghouse would prefer this outcome, as they have recently hired prominent lawyers to challenge the XRP-SEC lawsuit claims.

Kalshi Targets Crypto Traders as Election Betting Surges, Launches USDC Deposits

In line with surging interest in political wagering regarding the upcoming U.S. elections, Kalshi is actively pursuing crypto investors and traders as potential users. As announced by its CEO, this prediction market platform started accepting deposits in USDC stablecoin on Monday, enabling American traders to place bets on the results of both presidential and congressional races.

The recent update significantly boosted the amount of data going to Kalshi, making it a serious competitor to the established crypto-based prediction market, Polymarket.

Over just 36 hours after USDC deposit options became available, approximately $20 million was deposited by nearly 21,000 users – marking the company’s highest inflow in such a brief period as stated by Jack Such, Head of Market Research. The surge in retail deposits was particularly noteworthy, but there was also increased activity from institutional investors and crypto enthusiasts, with traditional finance brokers providing cryptocurrency services among them.

Beyond the USDC deposit partnership with Zero Hash, Kalshi’s crypto integration doesn’t end there. In fact, they’ve recently unveiled another collaboration – this time with the decentralized data marketplace Stork. Through this new partnership, Kalshi is set to take its prediction market data and make it accessible on a blockchain platform.

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2024-11-01 21:50