SA Asks: How will the U.S. election results impact crypto?
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Now that Election Day is over, investors will be eager to find out how the results will impact specific sectors.
Which brings us to our latest SA Asks question: how will the U.S. election results impact cryptocurrencies?
We asked Seeking Alpha analysts Mike Fay, Mandela Amoussou and Dominic Lombardo to weigh in on the topic.
Mike Fay: A Trump administration is going to be viewed as far more friendly to the industry and I suspect we’ll see outperformance in assets and networks that have come under fire from US-based regulators. Assets like Ripple (XRP-USD), Algorand (ALGO-USD) and Binance (BNB-USD) come to mind.
Regardless of who takes the White House, Bitcoin’s trajectory will likely continue higher due to the belief that it is “digital gold” or anti-fiat currency. Neither Harris nor Trump would likely address concerns about the US budget deficit. It is widely expected by most in crypto that Bitcoin will rise with or without a friendly US government.
The only real question remaining in my view is if a Trump victory has been priced in already. But we’re unlikely to know that definitively in the days following the election.
Mandela Amoussou: The immense publicity cryptocurrencies have garnered from both candidates throughout the campaign has set the stage for growing demand for crypto assets and their related investment vehicles. Donald Trump’s pro-crypto stance during the campaign, and his eventual win, means interesting times lie ahead for cryptocurrencies. Trump’s presidency may lean towards more lenient crypto regulatory policies, which could increase market volatility and raise both the opportunities in and the risks of crypto assets.
Dominic Lombardo: Cryptocurrencies are set to perform well post-election, regardless of who wins.
Short-term, crypto prices could be pressured if there’s a “risk-off” period related to delayed results. Further, on-chain metrics and sentiment remain somewhat bearish. I don’t expect cryptocurrencies, particularly altcoins, to rally until Bitcoin dominance trends down from its local peak, ~ 60%, and until there’s an acceleration in global liquidity.
The largest difference between the two parties is regulation. With a Trump win, I expect the SEC’s Gary Gensler to be replaced by a chairperson that’s supportive of the industry and clearer “rules of the road” via congressional regulation.