U.S. spot bitcoin exchange-traded funds attracted nearly $2.4 billion in net inflows in the six days ending Oct. 18, according to data compiled by Bloomberg, partly on bets that U.S. cryptocurrency rules will become friendlier after the Nov. 5 presidential election.
Republican candidate Trump has publicly supported cryptocurrencies, so much so that bitcoin is seen as a so-called Trump trade. Democratic rival Vice President Kamala Harris has vowed to support a regulatory framework for the industry. This is in stark contrast to the crackdown on the industry during the Biden administration.
David Lawant, head of research at cryptocurrency prime broker FalconX, believes that two key market trends are the election and the global macroeconomic environment. "The bitcoin options market shows that forward implied volatility is mainly concentrated around the election day, while it is slightly subdued in the period before and after the election," he wrote in a report.
Bitcoin rebounded nearly 10% in the week ending Sunday, the best weekly performance for cryptocurrencies in more than a month. Bitcoin hit a record high of $73,798 in March due to demand from exchange-traded funds.
