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Bitcoin rallied overnight, hitting an all-time high as investors bet former President Donald Trump was gaining an edge in the U.S. election as results rolled in.
The price of the flagship cryptocurrency touched a record $75,000 on the nose, according to Coin Metrics. It was last higher by 7% at $74,392.00. It first hit its previous record of $73,797.68 on March 14 and has traded in a narrow range below $70,000 for most of the year since then.
Bitcoin’s overnight gains increased as Trump took an early lead in the Electoral College. NBC News projected that Trump had won a key victory in North Carolina and Georgia, but other swing states are still too close to call. Republicans are also expected to regain their majority control of the U.S. Senate, according to NBC News.
Exchange operator Coinbase rose 3% in after hours trading, while MicroStrategy, advanced 4%.
Investors had expected bitcoin trading to be choppy until a clear winner is declared. A victory for Vice President Kamala Harris was expected to bring risk of downside moves to the price of bitcoin, while traders anticipated a bump in price in the event of a win by former President Donald Trump.
Bitcoin rises above $71,000 on election night
“The election is having a massive influence on crypto,” said Ryan Rasmussen, head of research at Bitwise Asset Management. “Expect bitcoin – and crypto more broadly – to be choppy in the days ahead … until we have definitive election results.”
In the 2012, 2016 and 2020 elections, bitcoin saw returns of roughly 87%, 44% and 145% in the 90 days following election day, respectively. That’s in part because election years happen to fall on Bitcoin halving years, when the supply of the cryptocurrency ratchets downward. Post election returns have also tended to align with major Federal Reserve policy shifts. This year, the market is looking forward to further interest rate reductions.
“For now, everyone we’ve spoken to is keeping their powder dry,” said James Davies, CEO at crypto futures and options trading platform Crypto Valley Exchange. “I’ve heard from numerous leading market makers and traders and can say with conviction that almost everyone is set up to react … There’s likely to be massive short-term volatility whichever outcome.”
This year’s presidential election has been called the most important one in the crypto industry’s lifetime. Many view a Harris win as a threat to crypto, the extent to which has been debated throughout this election cycle. Trump, on the other hand, is seen by many as a force for good in the industry after he presented himself earlier this year as the pro-crypto candidate and has been courting the industry more directly than Harris has.
Many voters are concerned about the state of the government deficit, which rose 8% in the 2024 fiscal year to $1.8 trillion, and increased tax cuts promised by both candidates. Bitcoin, like gold, is seen by many investors as a hedge against the potential for fiscal and monetary policy that combine to reduce the value of the dollar and lift inflation.