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Bitcoin price passes $70,000 on US election speculation

Donald Trump appeared at a Bitcoin event in Nashville, Tennessee, in July. A Republican government is viewed as being more crypto-friendly than a Democrat government Reuters/Kevin Wurm
Donald Trump appeared at a Bitcoin event in Nashville, Tennessee, in July. A Republican government is viewed as being more crypto-friendly than a Democrat government
  • Cryptocurrency close to peak
  • Bullish outlook before US election
  • ‘Correction’ if Democrats win

The price of Bitcoin reached $72,479 this week, the first time that the cryptocurrency has gone above the $70,000 price mark since June. 

Although still below its March peak of $73,803.25, the world’s most prominent digital currency may have headroom to rise further.

“Bitcoin has rallied more than 65 percent year-to-date, with prices surging above the $70,000 mark in today’s session,” Vijay Valecha, chief investment officer at Century Financial in Dubai, said on Tuesday. 

He added that the key driving forces behind the recent surge include strong exchange traded fund (ETF) inflows and Donald Trump’s small lead in the US presidential election polls.

Although Bitcoin prices are just 2 percent away from their all-time high, “positive momentum does not seem to be slowing down”, Valecha said, adding that it “could potentially push prices to a $75,000 target”.

This suggests that late-comers may still benefit from Bitcoin’s rally. Gulf investors were projected to add Bitcoin ETFs to their portfolios in 2024, and the National Bank of Bahrain launched the region’s first Bitcoin investment fund earlier this month, signaling delayed but growing interest in the digital currency. 

“Gulf investors can participate in this rally as a momentum play and take advantage of the ongoing bullish momentum leading up to the US election day,” Valecha said.

Yet with some of this upward momentum hinging on the US election, Bitcoin is in a relatively fragile state with downside potential as well, looking ahead to the vote on November 5.

“Although Bitcoin prices are rallying to near record levels on the prospects of a potential Trump win, Ethereum remains well below its peak above $4,000 levels,” Valecha said.

“This could mean that the entire crypto market doesn’t seem convinced. Despite Harris’ support for cryptocurrencies, if the Democrats end up taking the Oval Office, the crypto market could be in for a correction.”

The outcome of the Federal Open Market Committee meeting next week may also impact Bitcoin prices. 

“Next week will be important,” Manuel Villegas, digital assets analyst at Julius Baer wrote in a note to journalists.

“The US elections and the decision from the US Federal Reserve are expected to dictate the outlook for crypto through the end of the year.”