Bitcoin price increased higher than 2% within 2 hours to merely top $14,000 as the election polls were beginning to close throughout various US states on 3rd November.
The United States of America is witnessing the election day, today, and various cryptocurrency leaders are predicting that Bitcoin could turn out to be the next winner within a highly contentious race. Initially, officials have calculated higher than 400000 ballots.
Being around only for two presidential elections of the USA, Bitcoin’s Price has increased notably with every successive race.
During November 2012, 1 Bitcoin was approximately valued at $12, whereas during 2016, the Bitcoin’s Price was higher than $700. With Bitcoin now touching $14309 mark at the publication’s time, it represents an increase of 1900% within the four years gap or approximately 140000% within eight years.
It refers to the second time Bitcoin has risen above the barrier of $14,000 within only a week with a notable mark that the daily candle has just closed beyond $14,000 for the first time from January 2018.
The increasing interest of institutions and the decision of PayPal to offer cryptocurrency services, along with other non-political factors might explain the rise of Bitcoin’s Price. On the other hand, social media engagement has additionally enhanced this month. As per the analytics, Bitcoin witnessed positive returns of 30% during October, when compared to 10% returns on Ethereum.
Within the conventional market, European and Asian shares increased, and the stock futures of the United States pointed to a higher open. On the other hand, the yield on the 10-year-old treasuries of the United States rose to 0.03% point to 0.88%. Alternatively, the strength of gold increased from 0.2% to $1,899 an ounce.
With the presidential election of the United States of America finally here, Donald Trump’s Republicans are convinced that the democratic Challenger Joe Biden will lead the United States of America down an irreversible path to disorder and socialism. It is because the Democrats are sure that another four years of Trump could signal very well to the end of decency and democracy.
Similarly, various Crypto enthusiast’s are simply putting their full faith in Bitcoin. Whether none of those might be justified or possibly all of it might be. Here are some of the Bitcoin oriented talking points:
1. The prices of Bitcoin merely reacted when Donald Trump defeated Hillary Clinton during 2016. the presidential election of The United States of America in 2016 barely budged the market of Bitcoin.
2. The action for the Price of Bitcoin for the whole month of November 2016 becomes entirely lost within the long-term chart. The month of November 2016 hardly looked significant in the context of the long term bull run of Bitcoin.
3. The blue wave, concerning which Joe Biden wins, and the Democrats take full control of the upper legislative chamber of the Senate of the United States. It could make it simple for the earlier vice president for implementing the plan that incorporates spending much on climate change and social problems. This kind of fiscal stimulus might expand the already recorded federal budget deficits of the United States. It possibly would have to be backed up by the federal reserve with the help of money printing. On the other hand, BTC might profit from the US dollar’s ostensible weakening.
4. The red wave, where the US Congress is considered as the low probability event, and the Republicans hold the presidency, might lead to a fluctuation in stock prices with a risk on the environment when it comes to financial assets. The environment was pretty bullish for Bitcoin within the decade through 2019. Donald Trump has had massive tax cuts throughout the second term with massive stimulus. It would possibly signify the need to print huge amounts of new cash for financing it all.
5. Regardless of the outcome, in any scenario, Bitcoin is likely to prosper.
6. The futures contracts of Crypto exchanges have surged for the past week, but are, however, indicating that Donald Trump is pointed for a loss. Utility tokens were exchanging hands late Monday, and these additions will pay out if Donald Trump technically loses but remains the president after January 2021.
7. A Host of important local elections could shake up the landscape for the industry of cryptocurrency policy-making for ages to come.
8. A substantial section of the election handicapping within the conventional market has concentrated on the possibility for steep volatility within the event that there remains no clear election result potentially pointing to prolonged uncertainty or also a constitutional crisis. It will make sense if the election results point to instability and turmoil within the United States for people to turn to cryptocurrencies or Bitcoin as they grow, ever wary of politicians and Central banks in general.
9. As voters have cast early ballots in uncountable numbers, the possibility for prolonged risk might be overstated. It will be calculated in hours or maybe days, but not months and weeks as some expect. Moreover, this might indicate that there is less to knock with bitcoin prices, which lately has been up, off their medium-term trajectory.
10. If Joe Biden wins, the other couple of months might witness outsize uncertainty as republicans intend to avoid helping an incoming democratic system. Pandemic continues to spread, unemployment is elevated, and the economy is going through tectonic transformations with the transition towards remote working. All of these indicate that there is a little possibility of calm coming back to Crypto markets or traditional financial markets, anytime soon.
11. Donald Trump’s 1.5 trillion dollars of tax cuts during late 2017 increased employment but truly never paid for themselves. Therefore, it ballooned the national debt before the pandemic even started. With the slow progression of the economy during 2019, monetary policy was loosened to keep the market from falling. It helped rekindle the Bull market, when it comes to Bitcoin, after a severe bear market of 2018. Alternatively, Bitcoin followed another step this year as 3 trillion dollars was pumped into the international markets. Ultimately, the Crypto industry gained 19 fold throughout the last four years since the election of 2016.
Both traditional market and Bitcoin investors appear to be forecasting pickup within volatility after Tuesday’s election in the United States.
The biggest one month implied volatility of cryptocurrency – expectations on how turbulent the prices will be over the upcoming four weeks as indicated in options markets – has increased to a two-week amount of 59 % within the past three days. One can expect the Crypto to trade volatile within the upcoming days.
The increased short term volatility of price expectations could be linked with fears that the results of the election might be contested, giving rise to a period of economic and political uncertainty.
On the other hand, while the implied volatility of one month has picked up, the metric of 6 month stays flat above 60%. It indicated that the market does not demand a prolonged period of uncertainty in the political environment within the world’s biggest economy. Moreover, the 10% rise in the implied volatility of one month is not a big move and highlights a moderate shift in sentiment.
Further, the extreme sentiment is witnessed in conventional foreign exchange markets where the one week implied volatility of Chinese Yuan has doubled during the last week to highest after 2011. Above all, the implied volatility for one-week gauges for the yen and the euro have additionally risen to the highest after April.