Crypto could be in for a wild ride if Donald Trump loses the 2024 election. Here's why.
Trump has positioned himself as the “crypto candidate” despite a previous history of calling Bitcoin a scam. In 2024, he's fully embraced the space, proposing pro-crypto policies like creating a Bitcoin advisory council and stockpiling national Bitcoin reserves. He’s promised to push the US into a leadership role in the global crypto market, specifically favouring Bitcoin mining and decentralised digital assets. Essentially, he’s making it clear that crypto will thrive under his leadership.
On the other hand, while not as aggressive in her pro-crypto stance, Kamala Harris has made her first public comments in support of digital assets. She’s committed to encouraging innovation in emerging tech fields like AI and blockchain but with more of a regulatory bent. Her platform is focused on creating clear rules and consumer protections. This means the crypto market wouldn’t crash overnight if she wins, but you can bet there’ll be much more scrutiny and oversight.
Trump’s administration would likely be marked by looser regulations and more crypto-friendly policies, such as opposing Central Bank Digital Currencies (CBDCs) and protecting the right to self-custody digital assets. His policies would likely encourage institutional investment in crypto, stimulating market growth.
But the short-term reaction from the markets would undeniably be swift. People don't trust Kamala on cryptocurrency, and she won't change her stance once elected.
Harris's focus on environmental concerns, especially regarding Bitcoin mining, suggests that her administration might introduce policies targeting high-energy consumption, which could negatively impact the industry.
If Trump loses, the major concern is that the market might react negatively without his deregulation-first approach. Investors who bank on crypto-friendly policies may pull out, causing a sharp decline in confidence and prices. Harris’s regulatory angle could introduce uncertainty, and historically, uncertainty has led to big market corrections in crypto. The real crash risk would come from investors selling off, bracing for less friendly policies toward decentralised finance, mining, and the broader crypto economy.
Bottom line: If Trump wins, crypto investors expect a green light on deregulation, mining, and expansion. However, if Harris wins, expect a pivot towards more rules and possible crackdowns on elements like stablecoins and mining, which could spook the market.
Brace yourself for volatility either way.