As a seasoned researcher with a background in economics and finance, I find André Dragosch’s analysis of the potential impact of the 2024 U.S. presidential election on crypto markets particularly insightful. His unique perspective, rooted in historical data and current trends, offers valuable insights for investors navigating this complex landscape.
On October 11, André Dragosch, Bitwise Asset Management’s European Research Head, delved into the potential effects that the 2024 U.S. presidential election might have on the cryptocurrency markets. With the U.S. electorate preparing to choose a new president on November 5, investors are closely watching how the election result could influence the returns of different cryptoassets, most notably Bitcoin.
In his analysis, Dragosch highlighted four major findings derived from historical data and present trends in the crypto market. Initially, he pointed out that Bitcoin tends to perform favorably following U.S. elections, irrespective of the victorious party. He presented evidence demonstrating a 4,268% increase in Bitcoin’s value over approximately 400 days after each of the last three elections (2012, 2016, and 2020). However, he added that the returns have gradually decreased with each election cycle.
In his analysis, Dragosch emphasized the coincidence of U.S. election cycles, Bitcoin Halvings, and periods of recovery in the business cycle. Specifically, he noted that the next U.S. election lines up with Bitcoin’s most recent Halving in April 2024 and what appears to be a potential U.S. economic downturn, as suggested by the ISM Manufactating Index. This repeated pattern has often boosted Bitcoin’s growth, and Dragosch posits that it could again provide positive momentum for the digital asset.
Thirdly, Dragosch’s study examined the relationship between significant cryptocurrency prices and the likelihood of either Donald Trump or Kamala Harris winning the election. In this analysis, Dragosch found that Bitcoin and other cryptocurrencies tend to rise when Trump’s chances increase and fall when Harris’ chances improve. He also observed that Dogecoin (DOGE) and Cardano (ADA) are particularly responsive to these potential outcomes. If an election were held today, Dragosch suggests that a Trump victory might cause Bitcoin to grow by about 10.7%, whereas a Harris win could potentially cause it to drop by 10.5%.
In summary, Dragosch underlined that while the relationships between most cryptocurrencies and the odds of the U.S. election are statistically negligible at present, these connections have been growing noticeably over the past few weeks. He predicts they will continue to strengthen as the election nears. Regardless of the election results, Dragosch suggests that the Bitcoin Halving and the possibility of a U.S. economic rebound could substantially enhance Bitcoin and other digital currencies in the upcoming months.
Here’s a simple, conversational way of expressing your statement:
— André Dragosch, PhD | Bitcoin & Macro ⚡ (@Andre_Dragosch) October 11, 2024
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2024-10-12 18:28