Bitcoin surges to $75,000, a new record, as traders bet Trump has election edge

Bitcoin rallied Tuesday evening, hitting an all-time high as investors bet former President Donald Trump was gaining an edge in the US election as results rolled in, according to a detailed report by CNBC.

The price of the flagship cryptocurrency touched a record $75,000 on the nose, according to Coin Metrics. It hit its previous record of $73,797.68, on March 14 and has been trading in a narrow range below $70,000 for much of the year since then, the CNBC report elaborated further.

Bitcoin’s Tuesday night gains increased as Trump took an early lead in the Electoral College, even though none of the major swing states were called yet by NBC News. Exchange operator Coinbase rose 3 per cent in after-hours trading, while MicroStrategy, advanced 4 per cent.

Investors are expecting bitcoin trading to be choppy until a clear winner is declared. A victory for Vice President Kamala Harris is expected to bring the risk of downside moves to the price of bitcoin, while traders anticipate a bump in price in the event of a win by former President Donald Trump.

“The election is having a massive influence on crypto,” said Ryan Rasmussen, head of research at Bitwise Asset Management. “Expect bitcoin and crypto more broadly, to be choppy in the days ahead until we have definitive election results.”

“If Trump wins, I believe we’ll see new all-time highs,” Rasmussen added. “If Harris wins, I expect a decent short-term sell-off, with prices taking a month or two to recover. But eventually, either way, I think we go higher.”

Bitcoin has a history of positive returns in the 90 days post elections

The CNBC report further explained that, in the 2012, 2016 and 2020 elections, bitcoin saw returns of roughly 87 per cent, 44 per cent and 145 per cent in the 90 days following Election Day, respectively.

 That’s in part because election years happen to fall on Bitcoin halving years when the supply of the cryptocurrency ratchets downward. Post-election returns have also tended to align with major Federal Reserve policy shifts. This year, the market is looking forward to further interest rate reductions.

At just below $70,000, bitcoin has been trading at its fair value price heading into Election Day, according to CryptoQuant. That means that if the election proves to be a positive catalyst in the coming days, bitcoin can rally and is poised to establish a new record, CryptoQuant analyst Julio Moreno said.

“For now, everyone we’ve spoken to is keeping their powder dry,” said James Davies, CEO at crypto futures and options trading platform Crypto Valley Exchange. “I’ve heard from numerous leading market makers and traders and can say with conviction that almost everyone is set up to react. They don’t even know which way markets will go based on results. There’s likely to be massive short-term volatility whichever outcome.”

This year’s presidential election has been called the most important one in the crypto industry’s lifetime. Many view a Harris win as a threat to crypto, the extent to which has been debated throughout this election cycle. Trump, on the other hand, is seen by many as a force for good in the industry after he presented himself earlier this year as the pro-crypto candidate and has been courting the industry more directly than Harris has.

Many voters are concerned about the state of the government deficit, which rose 8 per cent in the 2024 fiscal year to $1.8 trillion, and increased tax cuts promised by both candidates. Bitcoin, like gold, is seen by many investors as a hedge against the potential for fiscal and monetary policy that combines to reduce the value of the dollar and lift inflation.

Market participants and global investors will closely follow these developments and the election results. This will help them in taking informed investment decisions going ahead.