Analysis of the Impact of the 2024 U.S. Election on the Encryption Industry

Cryptocurrencies are growing in importance in U.S. politics and are one of the key issues in the 2024 election. This article provides a comprehensive analysis of the role of the crypto industry in elections and its possible development prospects.

Cryptocurrencies become the backdrop for important election issues

The significance of Bitcoin to the United States

Demand for hedging against inflation strengthens

Since the mid-1980s, real wages in the United States have all but stagnated, exacerbating the gap between rich and poor. Bitcoin is seen as a tool for anti-inflation and economic independence, and is especially favored by the middle class.

Over the next 10 years, the US federal budget deficit is expected to be between 6.2% and 7.8% of GDP. The federal debt-to-GDP ratio could climb from the current 100% to 124%-200%. Such a situation could trigger a "Minsky moment" and trigger a financial crisis.

The Bitcoin bill may provide new solutions to the U.S. debt problem by attracting substantial capital to stabilize the debt structure. Bitcoin, as a scarce asset, has potential strategic significance in addressing debt and inflation pressures.

Strengthen the international influence of the US dollar

Stablecoins have become a policy focus, helping to continue to strengthen the dollar's influence at a time when its global standing is weakening. Currently, more than 99% of stablecoins are denominated in US dollars.

Stablecoins have become one of the major holders of U.S. Treasury bonds, providing additional liquidity support to the economy. This shows that stablecoins not only enhance the global status of the U.S. dollar but are also an important part of the U.S. financial system.

Voter interest in encryption is rising.

About half of potential voters in the U.S. tend to support pro-encryption candidates. Cryptocurrency search interest has significantly increased in key swing states.

Biden administration's regulation of crypto businesses

The Biden administration has strengthened regulations on the encryption industry, filing lawsuits against several large encryption companies, including Binance and Coinbase.

encryption plays a core role in corporate donations

Coinbase and Ripple have become the largest corporate political donors in 2024. The Fairshake Super Political Action Committee (PAC) raised over $200 million to support candidates for encryption. The encryption donations have significantly influenced the candidates' positions.

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The impact of the general election

The policy proposals of both candidates

Harris

Harris has limited comments on encryption policy, only stating that she will "encourage innovative technologies while protecting consumers and investors." Her encryption policy may be more friendly than Biden's, but she remains cautious on key issues.

Trump

Trump said that he wants to make the United States "the global capital of cryptocurrencies and bitcoins", support bitcoin mining, and protect self-custody rights. He proposed the creation of a government reserve for Bitcoin, the creation of a cryptocurrency advisory board, and the blocking of policies such as the Federal Reserve's introduction of a digital currency.

A "split government" could emerge

Currently, it seems that unless one party controls both the Senate and the House of Representatives as well as the presidency, instability is almost inevitable. A divided government usually leads to policy gridlock.

The SEC leadership is likely to change.

Regardless of which candidate is elected, there could be a significant change in the SEC's leadership, which will affect crypto regulatory policy.

Macroeconomic liquidity: volatility is inevitable

Trump promised that if he is elected again, he will significantly cut interest rates, which could drive up Bitcoin and other encryption assets. Macroeconomic liquidity remains a key influencing factor in the encryption market.

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The impact of the election on crypto startups

Web3 prediction market achieves breakthrough

Polymarket has become the leading platform for betting on the U.S. elections, capturing 80% of the market share. Prediction markets are becoming an important tool for gathering public opinion and are widely adopted by mainstream media.

Predicting the future development of the market

Multiple exchanges have launched leveraged trading products related to the election. The combination of prediction markets and leveraged trading provides new opportunities for professional traders.

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Trump's victory is beneficial for encryption companies' development in the US.

The Trump administration may provide a clearer and more relaxed regulatory environment, improving the development and listing prospects for encryption companies. This will help encryption businesses obtain traditional financial funding.

DeFi and BTCFi will be the first to benefit.

BTCFi, as a consensus in the encryption industry, is expected to develop rapidly in a loose environment. It is anticipated that the total scale of BTCFi will exceed ten times the market value of BTC. The approval of Bitcoin upgrades such as OP_CAT will promote more innovative applications.

Overall, the outcome of the 2024 US election will have a profound impact on the crypto industry. Regardless of which candidate wins, cryptocurrencies have become a political and economic issue that cannot be ignored. Industry participants need to keep a close eye on the election process and its potential impact on the regulatory environment, market liquidity, and innovative development.

! HTX Ventures: A comprehensive analysis of the 2024 U.S. election, which may be a turning point from strict regulatory banning of the crypto industry to supporting innovation