The most awaited political exercise that sends strong waves across the globe, the US Presidential election, is scheduled to be held on November 5. This major political event is sure to influence the global financial market.
The speculations about the election result and the possible policy changes that may take place as a result of the political changes will influence the outcomes of the money market.
The decentralized financial market and its famed digital currency, the cryptocurrency, are no exception to the influence of the US elections, but what is more important is the way in which cryptocurrencies are set to influence the outcomes of the US Presidential elections.
Some Insights about the US Cryptocurrency Market
The cryptocurrency market in the United States is the largest and the most influential among the crypto markets in the world. It owns a majority share of the global crypto coins.
Cryptocurrencies worth USD 1.19 Billion were in circulation in the US alone in 2022. The compound annual growth rate (CAGR) of the token is predicted to be at 12% from 2023 to 2030.
The sudden shift to digital transactions in the wake of the COVID-19 pandemic and its continued adoption even after the pandemic years is the major reason for this spiking growth of these digital coins.
Moreover, the decentralized nature of the tokens, the lower transaction costs, speed and general ease of transaction, security, and safety of the online ecosystem, and the ease of access of cryptocurrencies even in those areas of the world where the traditional financial infrastructure have failed to reach are all positive elements in favor of the dominance of cryptocurrencies in the US market.
How is Cryptocurrency Going to Influence the US Elections?
The number of cryptocurrency holders in the United States has crossed 50 million. That means almost 1 in 5 voters in the US have a stake in one cryptocurrency or the other.
This is a substantial share of the vote bank that determines the outcome of the election. This statistic is pivotal in the light that Donald Trump, one of the candidates in the US Presidential election, himself is a holder and promoter of cryptocurrencies.
Trump is estimated to hold cryptocurrencies worth USD 6 billion. Moreover, Trump’s initial term as US President was a period when the United States implemented many policy changes that favored the dominance of cryptocurrencies in the US financial market.
On the other hand, the government under Joe Biden, the incumbent president of the democratic party, was skeptical about the influx of cryptocurrency.
After the collapse of some crypto firms during his term, Joe Biden’s government tightened the regulations and policies regarding crypto tokens.
There are many lawsuits at different stages of litigation between the U.S. Securities and Exchange Commission and various crypto firms. So the election results will influence the growth of the crypto market.
The litigation powers of the US government and its past regulations to control cryptocurrency trade in the US are the major reasons why crypto holders would join together to vote for a single cause.
As Brad Garlinghouse, the CEO of Ripple said, technology is going to become a partisan political issue in the 2024 US elections.
More than the crypto holders, the heads of various crypto firms are resolved to steer the election results in their favor.
It is evident from the fact that Ripple, Coinbase, and Andreessen Horowitz have donated USD 50 million each to power the activities of the crypto political action committee (PAC).
In order to counter the general dislike that crypto holders have towards the regulatory measures of the incumbent government, Biden’s camp is reported to have held talks with the officials of Ripple and Coinbase.
On the other hand, Donald Trump is emerging as a favorite of crypto supporters with his promises that he will encourage Bitcoin mining in the USA, making Bitcoin a “Made in US” brand.
The Bottom Line
Many crypto enthusiasts and crypto firms are vocal about their support for Donald Trump in order to ensure that the growth of digital coins in the future is guaranteed, whereas there are others in support of Joe Biden’s regulated way of dealing with this alternative financial system.
However, it can be undoubtedly said that crypto holders, who constitute 7% of the adult population in the US, will strongly influence the outcome of the 2024 US election.
