Regulation
Is Trump Good for Bitcoin? Analysts Say So Despite Past ‘Scam’ Posture
Top line
The “Trump factor” is a positive catalyst for the world’s largest cryptocurrency, bitcoin, Bernstein analysts said in a note to clients on Tuesday, while Donald Trump’s choice to nominate a crypto-friendly Ohio senator Mr. J.D. Vance while its running mate has further fueled bitcoin investors’ optimism about the prospect of the self-proclaimed “Cryptocurrency President” Trump, despite Trump’s previous attacks on bitcoin.
Donald Trump, left, and JD Vance present themselves as a pro-cryptocurrency duo.
Los Angeles Times via Getty Images
Main aspects
“The cryptocurrency market interprets a Trump victory scenario as more positive for cryptocurrencies” and the price of bitcoin is “positively correlated with the likelihood” of a Trump presidency, according to Bernstein analysts led by Gautam Chhugani.
Bitcoin has risen about 10% to nearly $65,000 since Saturday’s failed assassination attempt on Trump, which subsequently boosted his chances of prevailing in November’s presidential election. second to betting markets, which are an imperfect real-time proxy for voter turnout changes, though most Even recent polls suggest that Trump has a slight lead over Biden.
Bitcoin will continue to be “sensitive” to the election, Chhugani predicted, with a very bullish price target for bitcoin of $200,000 by the end of 2025.
Chhugani, who noted that the Biden administration’s “strong regulatory crackdown on cryptocurrencies and Trump’s pro-Bitcoin statements” are fueling bitcoin optimism, is the latest analyst to see another Trump presidency as a tailwind for cryptocurrencies, joining Standard Chartered analyst Geoffrey Kendrick, who expected Bitcoin could rise to $150,000 in a Trump victory, Conotoxia analyst Grzegorz Dróżdż, who She said would have a “positive impact” on cryptocurrencies more broadly.
Among the reasons why Trump is seen as more pro-crypto is his support for domestic bitcoin mining, the energy-intensive process of extracting new bitcoins from the digital blockchain that Biden has proposed impose a significant tax on, and its opposition to digital currencies issued by central banks that could threaten the value of existing digital tokens like bitcoin.
Monday’s nomination of veteran cryptocurrency ally Vance as Trump’s vice presidential nominee likely bolstered Trump’s push, given that Vance owned at least $100,000 in bitcoin at the time of his nomination. most recent financial information and has repeatedly advertised less regulation of the sector.
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Key context
Before this election cycle, Trump has repeatedly attacked Bitcoin and advocated for further regulation. “I am not a fan of Bitcoin and other cryptocurrencies, which are not money and whose value is highly volatile and based on nothing” and “unregulated cryptocurrencies can facilitate illegal behavior,” Trump he wrote on X in 2019. Other criticisms included said bitcoin ‘looks like a scam’ in 2021. Trump quickly turned to cryptocurrencies, sale million dollars in non-fungible tokens (NFTs) owned by him as of 2022, and his campaign has begun accepting cryptocurrency donations, bringing in Bitcoin Contributions Worth $1.8 Million in Q2 2024, declaring is “very positive and open-minded about cryptocurrency companies and everything related to this new and thriving industry” in May. Several prominent figures in the cryptocurrency industry have supported Trump, including billionaire twins Cameron and Tyler Winklevoss, who complained that Biden has “openly declared war on cryptocurrencies” in his June pledge to donate $1 million each in bitcoin to Trump’s election efforts.
Against
Despite the cryptocurrency market’s apparent support for a presidential regime change, there have been several big wins for bitcoin under Biden. Since Election Day 2020, bitcoin has surged nearly 400%, from around $14,000 to nearly $64,000. More importantly, Biden-appointed financial regulators approved the first spot bitcoin exchange-traded funds in January, driving billions of dollars of institutional investment into bitcoin. Much of the cryptocurrency community’s criticism of the Biden administration has focused on Securities and Exchange Commission Chairman Gary Gensler, who has often been critic of space. Part of Gensler’s regulatory crackdown includes breaking up bad actors like the failed cryptocurrency exchange FTX, whose founder Sam Bankman-Fried is in the middle of a 25-year prison sentence and the FBI found In 2023, Americans lost an estimated $3.94 billion in cryptocurrency investment fraud, up 53% from the previous year.