A hedge fund manager believes that the upcoming US presidential election won’t slow down Bitcoin’s rally in the fourth quarter.
CK Zheng, the chief investment officer at ZX Squared Capital argues that neither political party has effectively addressed the country’s growing debt and deficit issues, which could in fact benefit Bitcoin after the election.
It’s very likely printer will go brrr no matter who wins
Bitcoin’s price is likely to rise regardless of who wins the election, as in previous Bitcoin halving events have historically led to strong fourth-quarter performances, and halving is in the same year as the US elections.
Both presidential candidates have overlooked critical economic issues that could play into Bitcoin’s favor.
“As 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 also mentioned that Bitcoin has thrived on uncertainties surrounding past elections before a winner was declared, and he expects this trend to continue.
Bitcoin has rallied over 50% in the fourth quarter six times since 2013. The gains tend to be even larger in years when halving events occur, and now we are in a halving year.
During the last halving in 2020, Bitcoin surged by 168% in the fourth quarter, coinciding with that year’s presidential election.
Future price movements are determined by politicians? Hold on!
Zheng thinks that Bitcoin could reach a new ATH in Q4 or shortly after. Yet, Samantha Yap, CEO of Web3 PR firm YAP, pointed out that the price increases are often the least interesting aspect.
She told that what really matters is the surge in retail interest in the crypto market that usually follows these rallies.
Media attention often comes next, generating excitement and hype around cryptocurrencies and Web3 technologies.
Zheng believes that if the Federal Reserve implements an aggressive 50 basis point interest rate cut successfully, it could also be positive for Bitcoin and other riskier assets if the US economy manages a soft landing.
Central banks want this soft landing by adjusting interest rates enough to prevent overheating and high inflation without causing an economic downturn.
We can’t know if it will be successful, but if yes, Zheng believes Bitcoin’s price will closely follow movements in the NASDAQ.
Institutional interest first
Leo Fan, a founder of Cysic added that liquidity is gradually returning to the market, which may set the stage for stronger price movements in the coming months.
He noted that Bitcoin’s image as digital gold and a safeguard against economic instability is pretty likely to attract more institutional investments as traditional markets remain highly unpredictable.
