Crypto nudges record levels
‘Trump trades’ drive crypto rally, while crypto gamblers drive the odds on Trump
Cryptocurrencies continued their rally over the last week with Bitcoin approaching $70,000. The price puts the currency within striking distance of its previous all-time high of $73,777 and open interest in Bitcoin futures has already hit a new high, passing $40bn for the first time.
Bitcoin’s rally led to gains in the wider crypto market, with Solana also gaining strongly and briefly breaking through the $170 mark earlier this morning.
The last 24 hours also saw the biggest crypto sector acquisition to date as payments group Stripe bought stablecoin platform Bridge for a reported $1 billion. The deal is widely regarded as an important step in crypto’s advances into the mainstream.
US election still dominating the market
With two weeks to go, the US election remains a closely run battle. The latest poll published by Forbes gives Harris a 1-point lead at 49% over Trump’s 48%.
Polymarket gives Trump a 61% chance of victory, but its figures are based on wagers placed in cryptocurrency and are far from representative of the US electorate. The Wall Street Journal has reported that as few as four crypto whales have placed bets worth a combined $30 million.
Whatever the outcome of the election, history suggests certain market movements may be more likely in the quarter following election days. Analysis over a 40-years period by City Index showed a tendency for the dollar to strengthen against the yen and gold to weaken in the weeks following a US election, whichever party wins.
Past events are of course not always a guide to the future. One thing on which we can be sure is that escalating global conflicts sell plane tickets for flights to safety. Growing tensions in the Middle East have driven gold to an all-time high above $2,730. With no signs of a peaceful resolution in the region, gold is set to remain buoyant, at least in the near term.
Moldova set for EU membership… and EU crypto regulation
Moldova may also be on the verge of a more open attitude to crypto, after its election and recent referendum of EU membership saw voters opt to join the European Union apparently by a paper-thin margin of 50.4%. The figure is far below expectations and Moldova’s president has claimed there has been significant interference, with fingers naturally pointing to Russia.
The result could however lead to a major change in Moldova’s policy on crypto, which is currently banned in the country, as EU membership would bring Moldova under the auspices of the Markets in Crypto Assets Regulations (MiCA).
D.O.G.E coin?
Never one to miss an opportunity to make a stir, Elon Musk has been making the most of his links to the Trump campaign. As the face of a proposed Department of Government Efficiency (DOGE) under Trump, Musk has taken advantage of the acronym to promote his favourite memecoin. Asked about recent difficulties at Space X, Musk posted: “D.O.G.E will fix it.” The post was credited with helping drive Doge’s recent rally.
While geopolitical factors, macro-economic takeovers and regulation all played a part in last week’s crypto rally, Musk has, for good or ill, demonstrated that a meme is still a force to be reckoned with.
Brought to you by the BCB Trading Team
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