Bitcoin Gives Up Gains as U.S. Election Anxiety Unleashes Crypto Volatility

The worst case scenario for risk assets including cryptocurrencies would be a delayed or contested election where the result is unknown for weeks, one observer noted.

A cryptocurrency rally saw a rapid reversal during the U.S. afternoon hours as the final stretch of the U.S. election left traders jittery.

Bitcoin (BTC) surged to $70,500 earlier during the day from around $67,000, then shed 2% in an hour to briefly drop below $69,000. It was trading at $69,000 at press time, still up more than 2% over the past 24 hours.

The broad-market CoinDesk 20 Index booked a 3% gain during the same period, led by native tokens of Near (NEAR), Aptos (APT) and Hedera (HBAR) advancing 6%-7%.

Ether (ETH) continued its streak of dismal performance relative to bitcoin, with the ETH/BTC ratio dropping below 0.035 for the first time since April 2021. ETH lagged with its 0.4% daily gain, while litecoin (LTC) was also flat.

The abrupt selloff happened as Trump Media & Technology Group (DJT), the company behind Truth Social social-media platform founded by Republican presidential nominee Donald Trump, plummeted 20% and was briefly halted from trading Tuesday afternoon.

There wasn't any immediately clear catalyst of the price drop, as odds for Trump winning the election dipped only slightly to 61% from 62% on blockchain-based prediction venue Polymarket. Traders perhaps took profits after DJT share prices earlier today spiked 18% from yesterday's closing price, and are still up 178% from the September lows.

Zooming out, bitcoin is still trading within a narrow range below its all-time record heading into the U.S. election night, which is viewed as a key source of uncertainty for crypto prices.

"We expect spot [prices] to chop around this range until we get more clarity on the election results this week, where a Trump win is likely to cause a knee-jerk reaction higher, and vice versa if Kamala wins," digital asset hedge fund QCP forecasted in a Monday market update.

The worst case scenario for risk assets including cryptocurrencies would be "a delayed or contested election – much like in the 2000 election – where the result is unknown for weeks," said Bohan Jiang, head of OTC options trading at Abra. "This would lead to a sell-off in risk assets in the meantime, wherein the event volatility would roll to subsequent weeks until we get a resolution."

The U.S. presidential election is set to conclude on Tuesday, with bitcoin and crypto prices closely tracking the final stretch of the campaign.

After surging to $70,500 during the morning hours, bitcoin prices dropped 2% in an hour to briefly drop below the $69,000 level. It was trading at $69,000 at press time, still up more than 2% over the past 24 hours.

The broad-market CoinDesk 20 Index booked a 3% gain during the same period, led by native tokens of Near (NEAR), Aptos (APT) and Hedera (HBAR) advancing 6%-7%.

A cryptocurrency rally saw a rapid reversal during the U.S. afternoon hours as the final stretch of the U.S. election left traders jittery.

Bitcoin (BTC) surged to $70,500 earlier during the day from around $67,000, then shed 2% in an hour to briefly drop below $69,000. It was trading at $69,000 at press time, still up more than 2% over the past 24 hours.

The broad-market CoinDesk 20 Index booked a 3% gain during the same period, led by native tokens of Near (NEAR), Aptos (APT) and Hedera (HBAR) advancing 6%-7%.

Ether (ETH) continued its streak of dismal performance relative to bitcoin, with the ETH/BTC ratio dropping below 0.035 for the first time since April 2021. ETH lagged with its 0.4% daily gain, while litecoin (LTC) was also flat.

The abrupt selloff happened as Trump Media & Technology Group (DJT), the company behind Truth Social social-media platform founded by Republican presidential nominee Donald Trump, plummeted 20% and was briefly halted from trading Tuesday afternoon.

There wasn't any immediately clear catalyst of the price drop, as odds for Trump winning the election dipped only slightly to 61% from 62% on blockchain-based prediction venue Polymarket. Traders perhaps took profits after DJT share prices earlier today spiked 18% from yesterday's closing price, and are still up 1

The above is the detailed content of Bitcoin Gives Up Gains as U.S. Election Anxiety Unleashes Crypto Volatility. For more information, please follow other related articles on the PHP Chinese website!