Analysts from HC Wainwright believe that the positive market reaction to cryptocurrencies indicates increased confidence in the election prospects of Republican presidential candidate Donald Trump.
This confidence comes because Trump is known for his pro-cryptocurrency stance, especially his support for Bitcoin (BTC) mining in the United States.
Following the failed assassination attempt on Trump during a campaign rally in Butler, Pennsylvania on Saturday, July 13, Bitcoin and Bitcoin mining stocks have seen a significant surge. Bitcoin has risen more than 9% since the incident, hitting a high of around $63,790 on Monday, while mining stocks have risen about 10% in Monday’s session.
“Many believe the tragic event immediately boosted Trump’s chances of winning the election in November, and since Trump is widely seen as a pro-crypto candidate, and has come out and publicly supported Bitcoin mining in the US, markets have rallied after the failed attempt,” wrote Mike Colonnes, a chartered financial analyst.
selling pressure
The price surge coincides with the end of selling pressure from the German government, which liquidated the remaining 50,000 bitcoins seized in the Movie2k case. The pressure on bitcoin prices has been eased, with US-based bitcoin ETFs seeing net inflows of over $1 billion last week, holding over 18,000 bitcoins.
Furthermore, the high pressure on the sell chain was partly due to the long-awaited Mt. Gox payout. In 2010, Mt. Gox became the world’s largest Bitcoin exchange but suffered a major setback in 2014 when it halted trading, declared bankruptcy, and revealed that it had lost nearly 850,000 Bitcoin to theft. Most recently, the transfer of 47,228 Bitcoin from a cold wallet linked to Mt. Gox sparked market reactions, while selling pressure from miners continues to weigh on prices following the recent halving that reduced mining rewards by 50%.
Increase the hash rate
In the week ending July 7, Bitcoin rose 8.7% to $61,015, outperforming broader equity indices. The network hash rate rose 2.7% to 598 EH/s, while the network difficulty remained at 79.5T after a 5% adjustment on July 4.
Higher BTC prices offset lower transaction fees, sending retail prices up 5.2% to $0.049/TH/day, reclaiming the $0.05/TH/day mark for the first time in three weeks.