Bitcoin poised for Q4 gains amid US election uncertainty and halving impact

Mila September 30, 2024

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Key Takeaways

Bitcoin historically performs well in Q4 following halving events.
US election outcomes may influence Bitcoin’s price due to economic policies.

Bitcoin’s price is set to benefit from the upcoming US presidential election regardless of the winner, according to CK Zheng, chief investment officer of crypto hedge fund ZX Squared Capital.

Zheng’s prediction points to the historical impact of Bitcoin halving events leading to strong fourth quarters, coupled with both US presidential candidates’ failure to address key economic issues that could play into Bitcoin’s favor.

For context, Bitcoin has grown by over 20,000,000% since 2011, far outpacing major US stock indexes. The Nasdaq 100 Index grew 541%, while other big US stock indexes rose 282% in the same period. Each year, Bitcoin’s returns averaged 230%, which is 10 times more than the next best performer, the Nasdaq 100 Index.

The alpha crypto previously benefited from uncertainties stemming from US presidential elections before the winning party was declared, and Zheng believes this trend will continue. Data from CoinGlass indicates that Bitcoin has historically soared in the fourth quarter, rallying more than 50% six times since 2013. Years with Bitcoin halving events often boosted these gains further.

“[…] both Republican and Democratic parties do not appropriately address the ever-increasing US debts and deficits during this election, this will be very bullish for Bitcoin especially post the US election,” Zheng claims.

Historical contexts

During the last halving in 2020, which coincided with the previous US presidential election, Bitcoin rallied 168% in the fourth quarter. Zheng expects Bitcoin to reach a new all-time high in Q4 or soon after.

Zheng also noted that the Federal Reserve’s potential “aggressive” 50 basis point interest rate cut could be “bullish” for Bitcoin and risk-on assets if the US economy achieves a “soft landing.” This economic scenario occurs when central banks adjust interest rates enough to prevent overheating and high inflation without causing a downturn.

Based on recent data, Bitcoin is trading at $64,400, down 2% over the last 24 hours. The upcoming election and halving event continue to generate speculation about the cryptocurrency’s future performance.