With the presidential election happening so soon, many analysts and industry experts are wondering how solid bitcoin’s future will be. Each candidate represents a different outcome for the world’s number one digital currency. Many analysts believe that the economy will be considerably stronger under Donald Trump, which means that the price of BTC could potentially be slow to rise, while Biden is likely to bring falls in the stock market, which may give bitcoin a chance to spike faster.
Will the Election Affect Bitcoin?
Over the past few weeks, bitcoin has been on a serious roll, spiking as high as $14,000 not too long ago – the highest it’s been since summer of last year. However, the currency has since backtracked a little, with the price of bitcoin falling back towards $13,500 at the time of writing.
Many Wall Street players and traders are concerned about the prospects of a Biden win, and believe that the democratic challenger is going to bring an end to the solid economy that has been established under four years of Donald Trump. Anatoliy Knyazev – the executive director at the brokerage firm Exante – explained in a recent interview:
A Trump win will probably be welcomed by the stock market players and bitcoin will keep on growing along with other assets. However, a Biden win, which may lead to a stock market fall, cold also work in bitcoin’s favor based on the expectation of the depreciation of the dollar.
Here is the thing we all need to think about. A Trump win could bring about steady growth, whereas a Biden win could bring down so many other markets and assets that it leaves room for only one to expand. Clearly, the latter offers more of a doomsday scenario that Americans – and traders everywhere, quite frankly – need to concern themselves with.
The price of bitcoin is important to most traders, but it shouldn’t come at the expense of other markets. This is what a lot of players don’t seem to be learning. Bitcoin should be an asset that grows alongside others, not at the expense of others. If bitcoin grows in price but the stock market falls and the US economy is ravaged by inflation, this is a major problem all the way around. Eventually, a lagging economy is going to seep into the bitcoin space and potentially do damage to digital finance as well.
Keeping the Economy in Check
Nigel Green – the chief executive of the deVere Group – explained that a spike in “safe haven” assets could potentially occur following the election. He states:
Markets loathe uncertainty, so in the event of a contested result, safe-haven assets will get a boost, especially non-sovereign classes such as gold and bitcoin.
Several economists are also warning that the stock market could slide as much as 20 percent granted one candidate refuses to accept the election results.