Bitcoin’s resilience may keep crypto unaffected by the 2024 US election. Economic trends, and not political shifts, drive crypto growth and long-term value.
As the U.S. gears up for the 2024 presidential election, investors are wondering how the next president could impact the direction of Bitcoin.
The market may be least affected by political changes when comparing Bitcoin with traditional stock exchanges. Data sources and analysis, together with opinions from experts, show that even though Bitcoin’s value varies with time and elections might briefly affect it, its fundamentals are nowhere near being influenced by who is in office.
In previous US election years, Bitcoin did fall slightly, albeit to a much lesser degree than stocks; the crypto shrank by about 10.3 percent in 2016 and 6.1 percent in 2020. This year, however, the cryptocurrency has already exhibited such a pre-election drop by approximately 6.3%.
However, crypto commentator Quinten François notes an interesting pattern: each election week has marked a “price floor” for Bitcoin, never to be revisited. This implies that Bitcoin tends to stabilize and even build resilience following these political events, setting the stage for future growth.
Each U.S. election week has set a #Bitcoin price floor that’s never been revisited
Let that sink in pic.twitter.com/c1OL7lNEgL
— Quinten | 048.eth (@QuintenFrancois) November 4, 2024
Why Economic Policy Drives Crypto More Than Politics
Ideas for regulations vary between administrations, but Bitcoin’s course depends more on general economic strategies, such as quantitative easing and debt. According to François, whoever wins will observe more ‘debt creation’ and ‘more money printing’.
More money printing, more liquidity.
The chart below shows how #Bitcoin’s price tends to track changes in global liquidity.
Source: @LynAldenContact pic.twitter.com/qbHcf72Iot
— Peregrino (@PPreungesheim) November 2, 2024
Bitcoin’s advantages as an inflation and currency hedge improve when governments expand money printing—a phenomenon more observable since the COVID-19 pandemic.
Thus, the main demand for Bitcoin is based on its scarcity and barring inflationary risks, which has mostly allowed it to continue to grow through various economic changes, though not political ones. Some regard it as protection against uncompromising fiscal and monetary policies that analysts expect to remain in force regardless of the election result.
Unlike stocks or national currencies, Bitcoin is decentralized and borderless. It differs from these in that its price can be influenced by a country’s political change. According to observers, thanks to its status as an intercontinental currency, Bitcoin bears little relation to American politics.
In fact, short-term regulatory changes may depend on Election results. Nevertheless, Bitcoin’s evolution appears to continue due to its global users and institutional adoption.
The Big Picture for Investors
In short, while U.S. political shifts are likely to generate headlines, they are unlikely to alter Bitcoin’s core story. The cryptocurrency’s value continues to be shaped by broader economic forces and its unique role as a decentralized financial tool, making it more resilient than traditional assets in times of political change.
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