Analysts at Bernstein have reiterated their forecast that bitcoin could achieve new all-time highs between $80,000 and $90,000 if Donald Trump wins the U.S. election next month. This analysis emerges during a significant divergence of election odds favoring Trump since Vice President Kamala Harris accepted the Democratic Party nomination.
This year, Trump has repositioned himself as a pro-crypto candidate by accepting cryptocurrencies for campaign donations and proposing policies aimed at establishing the U.S. as a bitcoin mining powerhouse. This includes appointing a crypto-friendly SEC chair and creating a national strategic bitcoin reserve.
In contrast, Harris had not addressed cryptocurrencies until recently. Last month, she made broader comments suggesting she would encourage crypto business while protecting consumers, stating that the U.S. should become dominant in blockchain technology and that digital assets are a part of her vision for an opportunity economy.
Bernstein analysts believe that irrespective of the election results, bitcoin will perform well in the long term due to low interest rates, ongoing U.S. fiscal deficits, and unprecedented debt levels. However, they expect significant near-term reactions based on the election results.
“A Trump win would be incrementally positive for bitcoin and crypto markets,” wrote Gautam Chhugani, Mahika Sapra, and Sanskar Chindalia in a note to clients. “If Trump wins, we anticipate bitcoin could hit new highs of $80K to $90K, surpassing its previous peak of $74K. Conversely, if Harris wins, we predict bitcoin might test new lows in the $40K range.”
Analysts expect bitcoin to continue responding to the election odds, with a more positive outlook as Trump's perceived chances of victory increase. If the race remains too close, they foresee bitcoin becoming range-bound until election day, November 5.
In terms of altcoins, the analysts noted that assets like ETH and SOL are likely to remain stable until after the elections when there is more clarity on regulatory frameworks and the SEC chair.
Polymarket is a leading election prediction platform, with over $1.5 billion in betting volume tied to the U.S. presidential election. Given Trump's pro-crypto stance and Polymarket's blockchain foundation, some argue there is an intrinsic bias toward him. Bernstein analysts, however, contend that users are more likely to bet based on probability rather than bias.
“This was evident as Harris's odds were ahead of Trump until recently,” they said. “Crypto investors are likely to hedge their bets by backing Harris.”
Trump has experienced odds fluctuations on Polymarket, leading Harris in two phases until her recent positive debate performance. Following a rally in Pennsylvania, Trump's odds surged, with him leading Harris by 8% at one point.
Despite these fluctuations, national polling averages indicate a neck-and-neck race, with Harris holding a slight 3% lead as of now.
As the election approaches, market dynamics and voter sentiment will play crucial roles in the future of bitcoin and cryptocurrencies. Current trends suggest that the outcome of the election could have substantial implications for the crypto market.
