[US Election 2024]
Bitcoin and Other Cryptocurrencies Plunge
'Trump SNS' DJT Also Drops 40% in Four Days
With the U.S. presidential election just two days away, Democratic candidate Vice President Kamala Harris is showing a strong final push, causing the 'Trump trade'?investments benefiting from former President Trump, the Republican candidate?to waver.
According to Coinbase, a U.S. cryptocurrency exchange, as of 2:57 p.m. Eastern Time on the 3rd (local time), the price of one Bitcoin was $68,623.58, down 1.26% from the previous day.
Bitcoin briefly surpassed $73,000 on the 29th of last month for the first time since March this year, nearing an all-time high. However, its price has dropped more than $5,000 in just five days.
Another cryptocurrency, Ethereum, has fallen 1.53%, while Solana is down 3.12%.
Cryptocurrencies including Bitcoin had risen as the market increasingly anticipated the election of former President Trump. Trump had announced plans to dismiss Gary Gensler, chairman of the Securities and Exchange Commission (SEC), who holds a negative stance toward cryptocurrencies.
The stock price of Trump Media & Technology (DJT), a social media-related company owned by former President Trump, has also recently fallen sharply. DJT shares surged 37.7% over three trading days from the 25th to the 29th of last month. However, from the 30th of last month to the 1st of this month, the stock plummeted 40%, dropping from $51.51 to $30.56 in just four days.
This contraction of the Trump trade is analyzed as a result of Vice President Harris’s strong performance in recent polls. According to a poll by The New York Times (NYT) and Siena College on the same day, Harris led former President Trump in four of the seven key battleground states and tied in two, with Trump leading in only one. Supporting Harris’s late surge is a Des Moines Register poll showing that in Iowa?a state that voted for Trump in both the 2016 and 2020 elections?Harris holds 47% support compared to Trump’s 44%. According to betting site Polymarket, Trump’s chances of winning have dropped from 67% on the 29th of last month to 53% on this day, while Harris’s chances have risen from 33% to 47% during the same period.
However, the dollar remains strong, sustaining some aspects of the Trump trade. The Dollar Index, which measures the dollar’s value against six major currencies, stood at 104.2 as of the 1st, up 3.7% in a month. If Trump is elected and his promised tariff increases materialize, inflation could rise, delaying interest rate cuts and sustaining a strong dollar, experts say.
On Wall Street, there is a view that the race remains too close to call as both candidates show neck-and-neck competition until the final moments. Calvin Yeo, portfolio manager at Blue Edge Advisors, said, "November 5th will be like fighting a muddy battle blindfolded in a minefield, with no way to foresee what lies ahead. The election is so fiercely contested and the outcome could change depending on the path it takes, making it very difficult to trade."
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