In a surprising shift, crypto assets are emerging as a key focus in the upcoming US presidential election, with analysts suggesting it could become the new “Trump Trade.” Analysts from Bernstein argue that Republicans are increasingly embracing a pro-crypto stance to attract voters and secure funding from supportive super PACs.

Historical Context: The Original “Trump Trade”

The term “Trump Trade” originally referred to the surge in US stocks, Treasury yields, and the dollar following Donald Trump’s 2016 election victory. Now, analysts predict that a potential Trump re-election could similarly trigger a rally in crypto markets, driven by institutional adoption and a more favorable regulatory environment.

Former President Donald Trump has recently expressed strong support for the crypto industry, meeting with Bitcoin mining leaders and advocating for more domestic production of Bitcoin. However, analysts caution that his stance could shift, noting a potential return to skepticism if re-elected.

Biden’s Potential Stance Shift

President Joe Biden, criticized for the SEC’s tough approach on crypto, may use the upcoming debate to signal a softer stance. Despite initial crackdowns, the approval of Bitcoin and Ether ETFs earlier this year suggests a possible easing in regulatory hostility.

Investors are advised to approach candidate statements with caution, as rhetoric may not necessarily translate into policy outcomes. Both candidates’ positions on crypto could impact market sentiment, but analysts caution against overestimating their influence on eventual regulatory decisions.

As the 2024 presidential election approaches, crypto’s role as a potential “Trump Trade” underscores its growing importance in political and financial landscapes. Whether under a Republican resurgence or a Democratic recalibration, the trajectory of crypto markets remains intricately linked to evolving regulatory dynamics and political rhetoric.