Amidst a broader market upturn, the Bitcoin ecosystem has stood out as the best-performing sector in the crypto industry over the last seven days, spurred on by the latest political developments.
The fully diluted valuation of the Bitcoin ecosystem sector composed of four cryptocurrencies – Stacks, Core, ORDI, and SATS – has risen 34.9% over the past week, outpacing other sectors such as artificial intelligence (27.4%), memecoins (19.8%), and real-world assets (18.7%), data from blockchain analytics firm Artemis shows.
The recent strong performance of the Bitcoin ecosystem comes a few days after the SEC concluded its years-long securities investigation into Stacks, a layer 2 network built atop Bitcoin. This has helped Stacks’ native token STX jump nearly 40% to $1.88 since July 9.
The price of BTC has risen more than 12% in the past seven days to currently trade at $64,579, per CoinGecko. “When Bitcoin goes on a run, it pulls up the entire market,” Charlie Hu, the co-founder of Bitcoin L2 network Bitlayer, told Unchained over Telegram. “But it especially boosts the performance of projects in the Bitcoin ecosystem. Bitcoin-native tokens can do multiples in performance compared to the BTC asset itself.”
The price movement of BTC and its wider ecosystem comes with the increased probability of pro-crypto GOP candidate Donald Trump winning the 2024 presidential election after he survived an assassination attempt on Saturday in Pennsylvania. Trump’s chances of becoming the next US president stood at 60% on the day of his assassination attempt and has since increased 11 percentage points to 71% at the time of writing, per predictions market platform Polymarket.
Trump, who once criticized cryptocurrencies when he was in the Oval Office, is not only keeping his commitment to speak at the Bitcoin 2024 Conference in Nashville next week, but has also chosen a Bitcoiner as his vice-presidential running mate. J.D. Vance, an Ohio senator, ran as a crypto ally in his senatorial race and owned between $100,001 and $250,000 worth of BTC as of 2022, according to a financial disclosure statement that he filed in Oct. 2023. Vance has also drafted a bill that would overhaul how the US government regulates cryptocurrencies.
Read More: Trump Picking J.D. Vance as Vice Presidential Running Mate Sends Vance Related-Memecoins Soaring
“Bitcoin is in a perfect storm: we see growing demand from interested investors, both the regulatory acceptance and political support are increasing further, and the recent technology improvements power the emerging DeFi ecosystem that can help Bitcoin grow tenfold,” Dr. Chiente Hsu, the co-founder and CEO of decentralized exchange ALEX, toldUnchained over Telegram.
Growing Fundamental Interest
One recent technological improvement is computational system BitVM, short for “Bitcoin Virtual Machine.”
“BitVm enables computations and smart contract capabilities while still relying on the same Bitcoin consensus, and allowing Bitcoin to have more functionality as an L1 beyond payments and a store of value,” the co-founder and chief operating officer of Firinne Capital, Jim Hwang, wrote in a text message to Unchained.
“IMO, this is driving fundamental interest [as] many organizations are working hard to make these new functionalities into a reality,” Hwang said.
