As the U.S. presidential election draws near, many are speculating about how the outcome will impact markets. However, for cryptocurrencies, it might not matter who wins. According to financial experts, a massive “reflation” is on the horizon, driven by liquidity and global monetary policies, meaning that asset prices—including bitcoin—are likely to rise regardless of whether Donald Trump or Kamala Harris takes the White House.
Alex Kruger, founder of advisory firm Asgard, explained that with last week’s payroll numbers coming in strong and the U.S. Federal Reserve signaling future rate cuts, liquidity is expected to flood the market. “Rate cuts are coming, liquidity is going to be flowing into the market,” Kruger said on the latest Bits + Bips podcast. He emphasized that this will lead to a broad “reflation” across various asset classes, with money moving out of short-term investments and into riskier options such as equities, bonds, and especially crypto.
Kruger highlighted how this influx of liquidity will likely drive up the prices of almost all assets, from gold to crude oil, but that bitcoin and other cryptocurrencies could see especially significant gains. “It means all assets go up,” he noted, explaining that the shift out of short-term money markets will benefit long-term investments, including crypto, which thrives in a low-rate environment.
On the podcast, Nikos Kargadouris, CIO of an investment firm specializing in macro and digital assets, added that there’s approximately “$6 trillion sitting in money markets just waiting to pull the trigger.” This vast amount of cash is poised to flow into the markets, further boosting asset prices once conditions improve. Historically, Kargadouris noted, periods of global uncertainty, such as war, have seen investors shift toward equities and growth assets—a trend that could repeat in the near future.
Joe McCann, founder of crypto investment firm Asymmetric, noted that regardless of who wins the election, institutional investors are ready to pour money into the markets once the uncertainty clears. “No matter who wins, the view is that the market’s going higher,” McCann said. He also pointed out that Trump’s pro-crypto stance could further accelerate bitcoin’s rise. Trump has thoroughly embraced cryptocurrencies in his campaign, accepting donations in crypto and proposing policies to turn the U.S. into a global Bitcoin mining hub.
Read more: Trump Promises to ‘Embrace’ Crypto and Bitcoin in Economic Policy Speech
However, even with a Harris victory, bitcoin is expected to perform well in the long term. As Kruger pointed out, the broader trend of rate cuts and liquidity will still support asset prices. However, McCann suggested that under Harris, the rise in asset prices might move at a slower pace. “If it’s a Harris win, it’s probably more status quo, slower moving,” he explained, though the general upward direction would remain unchanged.
As Kruger summed it up, “The trajectory is very clear… both [Trump and Harris] are still going to have to do quantitative easing, they’re still going to have to cut rates.”
While the U.S. election will capture public attention, the real story for crypto markets is the impending flood of liquidity into global markets, which is likely to push bitcoin and other assets higher regardless of who wins the presidency.
