Elections versus Bitcoin

What’s getting everyone’s attention now is the timing of Bitcoin’s usual bull run, coinciding with the U.S. elections.

The upcoming U.S. elections in November have the potential to shake things up in the market. This isn’t about political preferences or party loyalty; it’s about how the market is likely to react based on the outcome. We’re in a cycle where external events, like an election, can act as a major turning point. But it’s important to manage expectations — nothing is set in stone. And historically, markets have shown sensitivity around election periods, and this time is no different.

Trump vs Harris

Right now, there’s a lot of hope being placed on what happens in November. If Trump were to win, many in the market believe that it could be the catalyst needed to break out of this current pattern of lower highs and push us towards all-time highs by the end of the year. The thinking here is that Trump’s positive stance on Bitcoin, combined with his previous actions like issuing NFTs, would create a more bullish environment for crypto. People see this as the jolt needed to get things moving again, breaking through the resistance levels that have kept prices subdued.

But if we’re talking about a Harris win, the reaction might be different. It’s not necessarily negative in the long run, but it could lead to a slower recovery. You might see a brief bounce in the market, but it could be followed by a more sluggish November and December as things remain uncertain. This doesn't mean a Harris win would doom the market — Bitcoin has survived and thrived in more challenging conditions before. But the pace of recovery could be slower, with a period of consolidation lasting into early next year.

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Impact on 4-year cycle

Ultimately, whether Trump or Harris wins, Bitcoin isn’t going away. The market will eventually recover. The key thing to remember is that Bitcoin has performed well over the years, regardless of who’s been in power. In fact, Bitcoin’s rise has mostly occurred under administrations that weren’t exactly pro-Bitcoin. This resilience has been part of its story — it thrives on the skepticism and has been able to grow in the face of adversity.

Looking at the bigger picture, we’re approaching a critical moment in Bitcoin’s four-year cycle. This is the point where things either break out to the upside. Right now, we’re at the tail end of the second year, traditionally a time of consolidation. But as we head into the third year, which has historically been the phase where the biggest gains happen, the market is looking for that spark to push it higher.

In any case, November is shaping up to be a volatile month. While the short-term picture remains uncertain, the long-term view is still bullish. Whether it’s in November or a few months later, Bitcoin is ready to push higher. The question is how quickly we get there, and that could be heavily influenced by the election results.

Written by Timothy Assi, a popular investor on eToro.

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