StanChart sees high volatility for Bitcoin in lead up to US elections StanChart sees high volatility for Bitcoin in lead up to US elections
Standard Chartered highlighted stabilized open interest and lowered short liquidation as Bitcoin braces for election-driven volatility.
2 min read
Updated: Oct. 31, 2024 at 5:58 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
Standard Chartered’s global head of digital assets research, Geoffrey Kendrick, cautioned that Bitcoin (BTC) may experience heightened volatility in the days before the US presidential elections.
Kendrick’s analysis pointed to key metrics indicating an optimistic yet cautious market sentiment among Bitcoin traders as investors brace for economic and regulatory shifts related to the political event.
Cautious optimism
Recent data reveals that Bitcoin’s funding rates — a measure reflecting market sentiment and the premium paid to hold long or short positions — have begun to favor bullish traders, with long positions gaining traction.
Positive funding rates often signal that traders are willing to pay a premium to maintain upward bets, suggesting confidence in Bitcoin’s potential for gains in the short term.
Kendrick highlighted that Bitcoin’s open interest has also stabilized, showing steady engagement among investors without the wild fluctuations in leverage seen in previous months. This stability could indicate a balanced sentiment as traders await potential price shifts related to the election’s outcome.
Another encouraging sign is the recent moderation in short liquidations, which had previously spiked. This decrease suggests a reduced appetite for bearish bets as traders become cautiously optimistic.
According to Kendrick, these trends collectively position Bitcoin for a potentially favorable performance, though he noted that the crypto’s history of volatility around major political events warrants caution.
Post-election outlook
In a report published last week, Kendrick projected that if former President Donald Trump wins the presidency, Bitcoin could see a significant price surge, rising as much as 10% in the immediate aftermath, potentially reaching around $80,000.
Kendrick also noted that a Republican sweep of both the presidency and Congress could create a pro-crypto regulatory environment, which may propel Bitcoin even higher, with a year-end target of $125,000.
Conversely, Kendrick indicated that a Kamala Harris victory might introduce short-term uncertainty for Bitcoin, with an initial price dip expected.
However, he predicted that the downturn would likely be temporary, as the market would adjust to a more measured regulatory pace under a Harris administration. He added that Bitcoin could recover and stabilize around $75,000 by the end of the year, driven by broader market confidence despite a less aggressive regulatory approach.
Bitcoin Market Data
At the time of press 5:58 pm UTC on Oct. 31, 2024, Bitcoin is ranked #1 by market cap and the price is down 1.6% over the past 24 hours. Bitcoin has a market capitalization of $1.4 trillion with a 24-hour trading volume of $40.84 billion. Learn more about Bitcoin ›
Crypto Market Summary
At the time of press 5:58 pm UTC on Oct. 31, 2024, the total crypto market is valued at at $2.37 trillion with a 24-hour volume of $86.45 billion. Bitcoin dominance is currently at 59.05%. Learn more about the crypto market ›
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Assad Jafri
AJ, a passionate journalist since Yemen's 2011 Arab Spring, has honed his skills worldwide for over a decade. Specializing in financial journalism, he now focuses on crypto reporting.
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Bitcoin, a decentralized currency that defies the sway of central banks or administrators, transacts electronically, circumventing intermediaries via a peer-to-peer network.
Standard Chartered
Standard Chartered PLC is a British multinational bank, headquartered in London, specializing in consumer, corporate, and investment banking, as well as treasury services.
A businessman, politician, and media personality, Donald John Trump served as the 45th president of the United States from 2017 to 2021.
Kamala Devi Harris (born October 20, 1964) is an American politician and attorney serving as the 49th Vice President of the United States.