As the U.S. presidential election approaches, speculation is swirling about its potential impact on financial markets. But for cryptocurrencies, the outcome might not be a game-changer. According to experts, a significant “reflation” could be on the horizon, fueled by liquidity and global monetary policies. This suggests that asset prices, including bitcoin, may rise regardless of whether Donald Trump or Kamala Harris takes office.
Alex Kruger, founder of Asgard, an advisory firm, points to recent strong payroll numbers and signals from the U.S. Federal Reserve about future rate cuts. These developments hint at increased market liquidity. On the Bits + Bips podcast, Kruger stated, “Rate cuts are coming, liquidity is going to be flowing into the market.” He explained that this influx could spark a broad “reflation,” with money shifting from short-term investments to riskier assets like equities, bonds, and cryptocurrencies.
Kruger believes that this wave of liquidity will likely boost the prices of various assets—from gold to crude oil—but that bitcoin and other cryptocurrencies could see especially notable gains. He remarked, “It means all assets go up,” underscoring how the anticipated move away from short-term markets might benefit long-term investments, including crypto, which tends to thrive in low-rate environments.
Nikos Kargadouris, CIO of an investment firm focused on macro and digital assets, added that approximately $6 trillion is sitting in money markets, ready to be deployed. He noted that, historically, times of global uncertainty often prompt investors to pivot toward equities and growth assets—a pattern that could repeat soon.
Joe McCann, founder of crypto investment firm Asymmetric, highlighted that institutional investors are primed to enter the market once election-related uncertainties resolve. “No matter who wins, the view is that the market’s going higher,” McCann observed. He also pointed out that Trump’s pro-crypto stance, including accepting campaign donations in cryptocurrency and proposing policies to position the U.S. as a bitcoin mining hub, could further bolster bitcoin’s ascent.
Even if Harris wins, however, bitcoin is expected to perform well over the long term. Kruger noted that the broader trend of rate cuts and liquidity support will remain, although McCann suggested that asset prices might rise at a slower pace under Harris. “If it’s a Harris win, it’s probably more status quo, slower moving,” he explained, though he acknowledged that the overall direction is still upward.
As Kruger summed up, “The trajectory is very clear… both [Trump and Harris] are still going to have to do quantitative easing, they’re still going to have to cut rates.”
While the U.S. election will certainly be in the spotlight, the real story for crypto markets might be the looming flood of liquidity into global markets. This liquidity surge is poised to push bitcoin and other assets higher, irrespective of who wins the presidency.
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