From last week until now Bitcoin is in a state of recovery, as the currency gained bullish momentum until it reached its highest levels since January 2018.
From last week until now live Bitcoin A state of recovery, as the currency gained upward momentum until it reached its highest level since January 2018, breaching the $14,000 level after passing the $13,000 level, amid optimistic expectations that the upward trend will continue to reach $17,000 by the end of this year.
During Election Day trading, Bitcoin surged as high as $14,000 before losing some of its momentum, retreating to the $13,800 range.
Multiple factors fuel the gains
Early Wednesday, voter counting was underway and the winner was not yet clear, however whether the eventual victor is President Donald Trump or former Vice President Joe Biden, it may not be this controversial election that is fueling the cryptocurrency's rise. the long term.
There are a number of other factors that explain the current momentum of Bitcoin, the most important of which is the recent announcement of the online payments giant PayPal that it is adding features that enable its users to buy and sell cryptocurrency on its platforms, in addition to the issuance of other financial technology companies listed on the exchange including Microstrategy and Square, adding Large amounts of bitcoin to its holdings.
Another thing that seems clear is that Bitcoin's bullish trend in the recent period is in stark contrast to the weak performance of the US dollar over the same period, even though the dollar has turned bullish in the short term.
Analysts say that the fiscal and monetary stimulus policies of the Federal Reserve and the US administration, such as the 3 trillion dollars that were pumped into US markets in order to ease the financial and economic pain of the Corona virus epidemic on the American economy and population, also worked to strengthen the digital currency, through high inflation and devaluation traditional currencies.
This will have a long-term effect as people will fear a significant decline in the value of traditional currencies and thus lose faith in the normal financial institutions based on the “laws” and “rules” of the world, and this will create a feeling of fear for the future of their savings.
Impact of the Presidential Election on Bitcoin
On the other hand, others believe that election uncertainty plays a stronger and more enduring role. It is worth considering how previous elections affected cryptocurrency prices. During the 2016 election after Trump’s surprise defeat of Hillary Clinton, Bitcoin barely moved.
A team of analysts believes that the upward trend is supported by a number of policy factors related to each candidate that can have some impact on the price. For example:
If Trump wins, he will continue to push for easy monetary policy in order to combat the economic weakness associated with the coronavirus, and this will be a positive environment for cryptocurrencies.
If Biden wins, Democrats are expected to raise taxes, but they are also calling for monetary policy easing from the Federal Reserve, so higher taxes could force some investors to convert their assets into cryptocurrencies more quickly.
On the other hand, others expect that the Bitcoin price is not likely to be affected significantly, either positively or negatively in the short term as long as there is a clear victory for either of the candidates, although both have different policies, but it is likely to play a direct role with US stocks. in several sectors rather than the Bitcoin itself.
However, if there is a disputed election outcome which remains entirely possible, the markets could see an additional short-term boost to gold and perhaps to traditional defensive stocks, and we could potentially see Bitcoin listed in the safe haven category driven by US-based buyers looking for a form of Low risk forms across a standalone asset.
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