Bitcoin’s Future: A Tale of Two Candidates?
Despite the increasingly partisan sentiment in the cryptocurrency industry, bitcoin will thrive over the long term regardless of who wins the U.S. presidential election in November. While some investors believe a second Trump term could propel bitcoin to new highs, others worry that a Kamala Harris presidency might dampen enthusiasm for the digital currency. However, industry experts believe that bitcoin’s future is less tied to political winds and more reliant on its underlying technology and robust adoption.
Key Takeaways:
- Bitcoin’s price is more likely to be impacted by macroeconomic factors rather than the outcome of the U.S. election.
- While there are concerns about a potential Harris administration’s stance on cryptocurrency, bitcoin’s history suggests it can thrive even in a less-than-friendly regulatory environment.
- The growth and institutional adoption of bitcoin in recent years have created a foundation for its long-term success regardless of the political landscape.
Bitcoin Beyond Politics
The cryptocurrency industry, especially the bitcoin community, has become increasingly polarized, with some aligning with the pro-crypto stance of former President Donald Trump and others expressing concern about a potential Kamala Harris presidency. While some analysts believe a Trump victory could give bitcoin a surge, others warn that a Harris win could create headwinds. However, industry experts contend that these partisan sentiments are overblown and that bitcoin’s long-term future is independent of who occupies the White House.
"This is about opportunities and regulation for U.S.-based users, not[the] price of a global commodity," said James Davies, co-founder of crypto trading platform Crypto Valley Exchange. "Crypto needs to learn from traditional finance, it needs to lobby both sides, align with both sides and succeed regardless of the election. If we want to build a big eco-system, we cannot afford to be partisan."
Navigating the Regulatory Landscape
While a second Trump term might see increased crypto-friendly policies, a Harris administration is expected to take a more cautious approach. This has led to some anxiety within the industry, but experts emphasize the resilience of bitcoin and its ability to navigate varied regulatory environments.
"Bitcoin has always been an investment that is rooted more in the fiscal and monetary profile of countries, sovereigns and the United States," said Steven Lubka, head of private clients and family offices at Swan Bitcoin. "Neither candidate changes that."
Lubka also pointed out that the regulatory climate under the current Biden administration has not hindered bitcoin’s growth. "Bitcoin did great" under Biden’s administration, he added. "It has been one of the most successful assets in the world during a period where everyone was opposed to it."
A Resilient Asset
The recent institutionalization of bitcoin, marked by the launch of U.S. bitcoin exchange traded funds (ETFs), has further solidified its position as a robust asset. Bitcoin’s performance in 2024, trading between $55,000 and $70,000 for most of the year, demonstrates its ability to hold its value amidst political uncertainty.
While short-term market fluctuations may be influenced by election news, the long-term trajectory of bitcoin appears unaffected. "The election results will have minimal effects on how bitcoin performs over the next 12 to 18 months," said Tyrone Ross, founder and president of registered investment advisor 401 Financial.
Beyond the Election Cycle
Bitcoin’s future is ultimately driven by its underlying technology, its increasing adoption, and the macroeconomic factors that influence global financial markets. While politics may play a role in shaping the regulatory landscape for cryptocurrencies, it’s unlikely to fundamentally alter bitcoin’s long-term growth trajectory.
"I would remind investors … that bitcoin did great," said Lubka. "It has been one of the most successful assets in the world during a period where everyone was opposed to it. Governments have traditionally been at least mildly hostile to bitcoin during its whole history, and it’s done extremely well."
As bitcoin continues to gain traction among institutions and individuals alike, its future appears bright regardless of the political winds that may blow. The technology’s inherent value proposition and its growing adoption are likely to be far more impactful than any single political event.
