Bitcoin’s value decreased as investors responded to the US presidential debate between Democratic nominee Kamala Harris and Republican opponent Donald Trump, who has shown support for the cryptocurrency industry. The digital currency dropped by as much as 2.6% before partially recovering to reach $56,490 by 7:40 a.m. in London. Concurrently, US equity futures, the dollar’s value, and Treasury yields all declined, while the Japanese yen strengthened.
Bitcoin is among the assets linked to Trump’s policies due to his expressed backing of the digital currency sector. As a result, Bitcoin was closely watched for potential indications of the debate’s impact. During the discussion, Vice President Harris aimed remarks at the Republican nominee, with pop icon Taylor Swift announcing her endorsement of Harris shortly after the debate. Betting markets subsequently reflected increased favorability towards Harris following the debate in Philadelphia on Tuesday night.
According to Caroline Mauron, a co-founder of Orbit Markets, a provider of digital-asset derivatives trading liquidity, the market perceived Kamala Harris as the debate’s winner, resulting in a slight downturn for the cryptocurrency. Although Harris has not outlined a clear stance on cryptocurrency, an advisor to her campaign previously indicated her support for measures that would facilitate industry growth while emphasizing the need for protective measures.
In contrast, Trump has shifted his approach to appeal to the digital-asset sector as part of his efforts to secure donations and votes in the competitive White House race. He has even expressed aspirations for the US to become the “crypto capital of the planet,” a significant shift from his earlier characterization of the sector as a “scam.” Trump’s recent initiatives include the release of a fourth collection of nonfungible tokens (NFTs), which have generated substantial revenue and the promotion of World Liberty Financial, a venture in the decentralized finance sector. The project faced a brief security breach last week, with hackers gaining control of certain Trump family social media accounts to publish a counterfeit announcement about the initiative.
The digital asset industry has emerged as an influential contributor in the presidential election through significant contributions to political action committees. Crypto firms are advocating for more favorable regulations, countering the critical position taken by the Securities & Exchange Commission under Chair Gary Gensler. Following a surge in demand for dedicated US exchange-traded funds, Bitcoin peaked at a record $73,798 in March. Although the rally has slowed down, the gains have helped overshadow memories of substantial market downturns in 2022, including the collapse of the FTX exchange, which became one of the most significant financial frauds in US history.
