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Coin Metrics analyses $3T crypto market before election

Coin Metrics analyses $3T crypto market before election

GrafaGrafa2024/11/06 11:00
By:Isaac Francis

Coin Metrics recently released a report analysing potential impacts of the 2024 U.S. presidential election on the crypto market, focusing on Bitcoin (CRYPTO:BTC) and other major digital assets.

According to the report by Tanay Ved and Matías Andrade Cabieses, Bitcoin has shown a historical pattern of increased volatility during U.S. election periods, with price fluctuations often lasting approximately 30 days post-election.

The report highlights that “Bitcoin’s realised volatility has historically increased around U.S. elections, typically remaining elevated for approximately 30 days post-election.”

This pattern suggests that political shifts can play a role in shaping market dynamics, particularly for assets sensitive to external events.

Coin Metrics’ report also draws connections between U.S. elections, Bitcoin halving events, and Federal Reserve policies, noting that the combination of these factors often reduces market uncertainty and can drive bullish sentiment in the cryptocurrency space.

For the upcoming election, volatility levels have been relatively low, but the report anticipates increased fluctuations as the election date nears, underscoring how political developments may impact digital asset values.

Additionally, the report examines Polymarket, a prediction market platform, to gauge investor sentiment surrounding the election.

Recent shifts in Polymarket odds for key political figures indicate growing global interest in the U.S. election’s outcomes and their possible effects on crypto markets.

Coin Metrics found that much of Polymarket’s trading volume takes place outside typical U.S. trading hours, highlighting the significant international attention on the election’s implications for crypto.

Looking forward, Coin Metrics advises monitoring key metrics, including trading volumes for major cryptocurrencies like Bitcoin, Ether (CRYPTO:ETH), and Solana (CRYPTO:SOL), as well as the ETH/BTC ratio and open interest levels in Bitcoin futures.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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