Jefferies believes Trump’s ‘overt’ support for Bitcoin will benefit crypto stocks, gold miners Jefferies believes Trump’s ‘overt’ support for Bitcoin will benefit crypto stocks, gold miners
Jefferies identified several crypto-related equities that could significantly benefit from these policies, including Coinbase and MicroStrategy.
2 min read
Updated: Jul. 19, 2024 at 8:38 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
Wall Street investment bank Jefferies analysts believe former President Donald Trump’s “overt support” for Bitcoin and crypto, combined with anticipated higher inflation, larger fiscal deficits, and political pressure on the Federal Reserve, could undermine the US dollar’s dominance as a store of wealth.
The analysts said in a research report shared on social media on July 19 that such an environment would be highly favorable for crypto-related stocks and gold miners. The phenomenon is already in play with crypto-stocks and the wider market rallying after Trump survived an assassination attempt.
As Trump’s prospects in the 2024 presidential election rise, these policies are becoming increasingly relevant for investors. The former President has voiced strong support for the sector, with the Republican party following suit by incorporating Bitcoin rights in its new platform.
Jefferies highlighted five key policies proposed by Trump that could significantly impact the equities market, with a particular focus on the benefits it would have for crypto-stocks.
Pro-crypto policies
According to Jefferies, Trump’s plan to extend the benefits of the Tax Cuts and Jobs Act (TCJA), which are set to expire next year, is expected to continue providing tax relief for businesses and individuals. This extension could boost consumer spending and corporate profitability, indirectly benefiting sectors related to digital assets by increasing disposable income and investment.
Trump has also proposed a further reduction in corporate tax rates, which could significantly enhance the profitability of US companies. This policy is likely to drive market optimism and lead to increased investment in various sectors, including those associated with crypto.
Additionally, Trump’s intention to increase tariffs, particularly on Chinese goods, could result in higher US inflation and altered global trade dynamics. Jefferies noted that this policy may drive investment towards alternative currency assets, such as crypto and gold, as investors seek hedges against inflation and currency devaluation.
Furthermore, a potential rollback of climate initiatives, coupled with expanded oil drilling, could benefit the energy sector but might negatively impact clean energy companies. However, this policy could also indirectly favor crypto by reducing regulatory pressures and fostering a more favorable investment environment for energy-intensive Bitcoin mining operations.
Jefferies also pointed to Trump’s plans to reduce involvement in global conflicts, such as the Russia-Ukraine war, which could lower geopolitical risks and contribute to market stability. This move is expected to benefit sectors that have a negative correlation with traditional commodity prices, further boosting the appeal of cryptocurrencies as a stable investment alternative.
Stocks to benefit
Jefferies identified several crypto-related equities that could significantly benefit from these policies, including Coinbase and MicroStrategy, due to their direct involvement with Bitcoin and crypto, as well as almost every major public Bitcoin miner, including Marathon Digital, Riot Platforms, and Cipher Mining, among others.
The list also includes CME Group, Square and Paypal, which recently launched its own stablecoin and has significantly increased its footprint in the crypto industry in recent years.
According to the report, these companies are poised to benefit from an environment in which the US dollar’s appeal diminishes and digital currencies gain traction as a store of value.
Jefferies stressed the importance for investors to stay informed and adapt their strategies to these potential policy changes. The anticipated support for crypto under a Trump administration could present significant opportunities for growth in the crypto sector.
Mentioned in this article
Bitcoin 
Coinbase 
MicroStrategy 
PayPal 
CME Group 
Marathon Digital 
Riot Platforms 
Cipher Mining 
Donald Trump Author 
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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In this article
Bitcoin, a decentralized currency that defies the sway of central banks or administrators, transacts electronically, circumventing intermediaries via a peer-to-peer network.
Coinbase
Coinbase is a digital currency exchange and wallet service that allows individuals to buy, sell, and store digital currencies, such as Bitcoin, Ethereum, and Litecoin.
MicroStrategy
MicroStrategy (Nasdaq: MSTR) is a worldwide leader in enterprise analytics and mobility software.
PayPal
PayPal is an American multinational financial technology firm that operates an online payment system in most countries that permits online money transfers and serves as an electronic replacement for conventional paper methods like checks and money orders.
CME Group
CME Group is a global markets company empowering participants to efficiently manage risk and capture opportunities in every major asset class..
Marathon Digital
Marathon Digital Holdings is a digital asset technology company that mines cryptocurrencies with a focus on the blockchain ecosystem and the generation of digital assets.
Riot Platforms
Riot Platforms is a bitcoin mining company, supporting the Bitcoin blockchain through rapidly expanding industrial-scale mining focused in the United States.
Cipher Mining
Cipher Mining is an industrial-scale Bitcoin mining company dedicated to expanding and strengthening the Bitcoin network’s critical infrastructure in the United States.
A businessman, politician, and media personality, Donald John Trump served as the 45th president of the United States from 2017 to 2021.
