The price of bitcoin (BTC) reacts with high volatility hours before the results of the presidential elections in the United States are known. Never before in its history has an electoral contest been so important for its price. As BitcoinDynamic has reported, digital currency took center stage in the campaign of candidates Donald Trump (Republican Party) and Kamala Harris (Democratic Party). The candidates for the Oval Room of the White House are aware that there are more than 50 million bitcoin users in that country and perhaps each of those votes could help define the election. The winner could be known this Tuesday, if the vote count advances quickly and the difference between Trump and Harris is wide. In this context, the price of the digital currency created by Satoshi Nakamoto fell below $68,000 in the last 24 hoursthus losing the support it had achieved in the $70,000 area. Support is defined as a type of floor with which the price of a digital asset collides to rebound to rebound strongly or stabilize. The price of a cryptocurrency does not usually go below that area because investors consider that selling it cheaper would be undervaluing it. Because of the psychology of the market, These levels usually repeat themselves throughout the history of the same asset, in this case BTC.
At the time of publication of this note, the price of bitcoin is $68,840.
Bitcoin price from January to November 5, 2024. Source: TradingView. For their part, bitcoin exchange-traded funds (ETFs) in the United States They reported money outflows of more than 541 million dollarsthe highest figure since last May 1. According to data from SosoValue, BlackRock's iShares Bitcoin Trust (IBIT) was the only one that ended the day with a green light, registering net inflows of more than $38 million. Since their market launch, the 12 ETFs based on the digital asset have had inflows of more than $23 billion.
Entries and exits in bitcoin ETFs since their market launch. Source: SosoValue. Due to their operation, the performance of these financial instruments has a direct impact on the price of BTC since the companies that those managed need to have the asset in their treasuries to support their actions. Due to the law of supply and demand, if there is greater demand than supply, firms must go to the market to buy bitcoin and that causes its price to rise. The opposite occurs if there is greater supply than demand. For this reason, due to capital outflows from ETFs, the price of bitcoin fell below $70,000.
The “battle” between Trump and Harris impacts the price of bitcoin
The quote of bitcoin could react up or down depending on the results that could be known this Tuesday, November 5. As BitcoinDynamic already reported, the market seems to be leaning towards a victory for Donald Trump over Kamala Harris. During his campaign, the Republican leader expressed a stance in favor of cryptocurrencies and promised that, if elected, he would establish a strategic national reserve of BTC. He also said that The nation will implement a regulatory framework friendly to the sectorwith the aim of promoting its growth. A victory for the current vice president of the government chaired by Joe Biden could be seen by the markets as a continuation of the current administration. which does not have too many followers among cryptocurrency users.
During recent years, the Securities and Exchange Commission of that country (SEC) had a firm and confrontational stance with the cryptocurrency industry. In fact, the organization led by Gary Gensler had legal disputes with Binance, Kraken and Coinbase. In this regard, analysts at Bernstein, a financial investment firm, project that BTC could skyrocket in the coming weeks to $90,000 if Trump is elected. If Harris is the winner, the report warns that the asset's price could fall to $50,000. However, the same firm anticipates that the digital currency will reach $200,000 in 2025, no matter who the winner of the next election is.