Biden Exits Race Impact on Bitcoin
President Biden's decision to end his re-election bid briefly shook Bitcoin, but Elon Musk's support quickly stabilized and boosted the cryptocurrency's value.
President Joe Biden's decision to end his re-election campaign has sent shockwaves through both political and financial sectors. Bitcoin initially dropped by 2.5% following the announcement but quickly rebounded, ending the day slightly up and maintaining an 8% gain over the past week.
Rich Rosenblum, co-CEO of GSR, described Biden’s exit as a short-term negative for Bitcoin. Former President Trump had hoped Biden would stay in the race, seeing him as an easy opponent. A younger Democratic candidate presents a tougher challenge for Trump, initially causing Bitcoin to sell off.
Despite initial concerns, Rosenblum noted that Musk’s endorsement counterbalances the reduced chance of a pro-Bitcoin president. As one of the world’s richest and most influential individuals, Musk’s support for Bitcoin is significant. His actions often lead to major market movements, as seen with his previous comments on Dogecoin.
The political landscape might not be entirely negative for Bitcoin. Although Trump’s reduced chances seem harmful, a more competitive election could actually benefit Bitcoin. Democrats might adopt a pro-crypto stance to attract younger voters, potentially leading to bipartisan support for Bitcoin.
This week, the crypto market faces additional volatility with the anticipated approval of Ethereum ETFs by the US Securities and Exchange Commission. David Lawant from FalconX emphasized that this could have a long-term positive impact by expanding investor exposure to crypto. Such regulatory approval would support broader crypto use cases and benefit the industry.
Bitfinex analysts pointed out that the uncertainty around the Democratic candidate will create a volatile week. Key events include the Ethereum ETF launch and the distribution of coins to Mt. Gox creditors, all contributing to a dynamic market environment.
Rosenblum speculated that Elon Musk might attend the Bitcoin 2024 event in Nashville, where Trump is scheduled to speak. Musk’s increased involvement in crypto could be highly positive. As a leading technologist, Musk could drive innovative uses for Bitcoin and broader crypto adoption. His comments about Dogecoin being the currency on Mars have caused significant market reactions. If Musk introduces more serious web3 ideas, this could greatly impact the market.
In summary, Biden's exit initially unsettled Bitcoin, but various factors have stabilized and potentially strengthened it. Musk’s influence, the anticipated Ethereum ETF approval, and political dynamics all contribute to a complex yet promising outlook for the crypto market. The evolving political and regulatory landscape will continue to shape Bitcoin’s future.
