(Kitco News) – Financial markets largely responded positively to Donald Trump winning a second term in office as Bitcoin (BTC) surged to a new all-time high while stocks opened strong. Precious metals, on the other hand, experienced a sharp sell-off, with both gold and silver seeing declines greater than 3% amid a surge in the U.S. dollar.
“Shortly after the North American markets closed, before any results were known, the market jumped back into the ‘Trump trade,’ which it had pared on Tuesday,” noted Marc Chandler, Chief Market Strategist at Bannockburn Global Forex. “The dollar and US interest rates soared. The euro is the hardest hit among the G10 currencies today, off about 1.6%, and the Canadian dollar is the best performer with about a 0.5% loss. Emerging market currencies have also been sold.”
As it became clear on Tuesday evening that a Trump victory was likely, cryptocurrency prices started to rally, with Bitcoin hitting a high of $75,426 in the early hours of Wednesday.
BTC/USD Chart by TradingView
It has since pulled back into consolidation above its previous all-time high of $73,750 and, at the time of writing, trades at $74,373, a gain of 6.93% on the 24-hour chart.
Another top performer was Dogecoin (DOGE), which surged to a high near $0.22 overnight and currently trades at $0.192 for a gain of 9.67% on the 24-hour chart.
DOGE/USD Chart by TradingView
“Bitcoin and crypto assets across the board are celebrating the US election results which are showing a landslide victory for Donald Trump,” said Joel Kruger, market strategist at LMAX Group. “Trump had been exceptionally supportive of crypto during his campaign, and market participants will now be looking for follow through during his next term in office.”
“Bitcoin has officially broken out to a fresh record high in the aftermath, clearing the next major psychological barrier at $75,000,” he added. “As per our technical insights, this now opens the door for a push to $100,000 in the weeks ahead.”
“Interestingly enough, it can be argued the rally in crypto assets has been relatively tame when considering the news,” Kruger noted. “However, the price action becomes a little easier to reconcile when looking at bigger picture macro flows.”
The bigger picture includes the surging dollar, which is rallying alongside cryptos and stocks while precious metals finally see the correction analysts have warned about.
“It was well known a Trump presidency would also bring about a wave of Dollar demand on the expectation for Dollar supportive policies in the form of tariffs and tax cuts,” Kruger said. “Indeed, the Dollar has rocketed higher on the election news, which has weighed on currencies across the board.”
“Still, crypto assets have outperformed, and we fully expect the dollar to soon top out as investors get back to thinking about rate cuts and accommodative central bank policy,” he added. “This will likely set the stage for an impressive wave of bullish momentum for crypto assets into year-end.”
While Bitcoin was a major talking point for Trump during the campaign, some analysts see a potential pivot to supporting the strength of the U.S. dollar to ensure its place as the world’s reserve currency.
“With Trump, we’ll likely see a mix of pro-business rhetoric with some anti-crypto sentiment from those looking to protect the USD status quo,” said Cory Klippsten, CEO at Swan Bitcoin. “Trump’s administration could impose short-term headwinds on Bitcoin by maintaining a harsh stance on digital assets, likely lumping them in with his views on other ‘disruptive’ technologies.”
“But Trump’s lack of regulatory interference may also favor Bitcoin’s growth as an unregulated, decentralized store of value,” he added. “Ultimately, Bitcoin doesn’t need government approval—it thrives on its independence.”
Alice Liu, Head of Research at CoinMarketCap, also sees a potential shake-up for the crypto market now that Trump has been elected but expects prices to continue to rise.
“Trump’s victory in the 2024 U.S. presidential election could shake things up in the cryptocurrency industry. Recently, Trump has taken a strong pro-crypto stance, promising to make the U.S. the ‘crypto capital of the world,’” she said. “His plans include dismantling current regulatory frameworks, appointing a Bitcoin and crypto advisory council to lead the SEC, and reducing regulatory hurdles for the industry – marking a sharp contrast to the Biden administration’s focus on strict oversight and consumer protection.”
“Trump’s idea to create a strategic Bitcoin reserve could legitimize Bitcoin as a key asset,” she added. “If successful, the U.S. would be the first major economy to treat Bitcoin as a reserve asset, which could attract institutional investment and send a strong signal to other countries about the viability of cryptocurrencies.”
“Market analysts are optimistic, predicting that Bitcoin prices could soar to $80,000 or even $90,000” with Trump’s victory, she said. “This bullish sentiment reflects growing confidence in a pro-crypto environment.”
Touching on the rally in Dogecoin, Liu noted that “Trump said that should he win, Elon Musk could have a position in government and could run a department dubbed the Department of Governmental Efficiency (D.O.G.E.). This was seen as a popularity push on the DOGE token, which sent its price surging after the remark.”
And according to Federico Brokate, VP and Head of U.S. Business at 21Shares, the biggest benefit a Trump presidency will bring for cryptocurrencies is a clearer regulatory framework.
“Establishing clear and consistent regulatory frameworks for digital assets will enable broader participation in digital assets from U.S. investors,” he said in a note shared with Kitco Crypto. “This approach not only fosters individual opportunity but also positions the U.S. to remain competitive in the global race for digital asset adoption and innovation. We’re confident over the next 4 years, we'll see greater regulatory clarity, which will lead to broader retail and institutional investors’ adoption of digital assets.”
