U.S. elections consistently impact the value of this particular cryptocurrency, causing fluctuations each time.
The crypto market is a dynamic and ever-evolving landscape, and understanding its patterns can be a strategic advantage for investors. One factor that significantly influences the prices of various cryptocurrencies is the U.S. presidential election.
In recent years, Toncoin surpassed $5.30 after the presidential pardon for Ross Ulbricht and the reversal of the Tornado Cash ban, highlighting the impact of political developments on the crypto market.
During electoral cycles, altcoins sensitive to U.S. electoral processes are those that depend on regulation, institutional adoption, and political support. Cryptocurrencies such as XRP, Solana, Cardano, Toncoin, and Dogecoin are no exception.
Political developments influence investor expectations on regulation, trade policies, and government support for digital assets, which drives volatility in these cryptocurrencies. For instance, Bitcoin plunged about 1.3% with a drop of over $1,500 immediately after Trump suggested he “probably” would not run for re-election in 2028, signaling political uncertainty that caused crypto markets to react negatively.
On the other hand, Trump's pro-crypto stance, including appointing crypto-friendly administration members and creating a strategic Bitcoin reserve, has generally boosted market confidence and prices in crypto assets, as seen with Bitcoin reaching record highs and specialized ETFs surging post-election.
Solana has an additional connection with U.S. politics through the "$TRUMP" meme coin, launched on its blockchain and promoted by Trump himself, which greatly affected its market dynamics by raising the meme coin’s value substantially and drawing public attention to Solana.
Key factors contributing to the volatility of these cryptos around U.S. elections include regulatory uncertainty or changes triggered by election outcomes or presidential policies, market sentiment shifts as traders react to candidates’ policies on digital currencies, and the influence of political narratives around digital asset legitimacy.
XRP, Cardano, Toncoin, and Dogecoin prices are also affected by these broader market forces, given their exposure to speculative investment and regulatory sentiment, though they have less direct political association than Bitcoin or Solana’s $TRUMP token.
For example, XRP's price is influenced by regulatory decisions and legal battles, such as its ongoing dispute with the SEC. XRP's price reached $1.45 in 2024 and is currently trading above $2.50, representing a nearly 400% growth since the last U.S. presidential elections.
Similarly, Solana's price rose 17% in a single day after the 2024 Republican victory, reaching $200. Political and media support has proven to be a powerful engine for Dogecoin's price, with the closeness between Elon Musk and Donald Trump and the symbolic creation of the "Department of Government Efficiency" (D.O.G.E.) contributing to its price increase by 24%.
Other altcoins, like Cardano, may also display similar price patterns in response to regulatory changes and political support. The rise in Solana's price was driven by the expectation of ETF approval and interest from large funds like VanEck. Toncoin showed signs of a possible 45% rally following these events, while Cardano showed a 12% recovery in the week following the 2024 elections due to optimism about a possible more favorable regulatory environment.
In summary, U.S. presidential elections impact these cryptocurrencies mainly through shifts in regulatory expectations, political support or opposition, and consequent investor sentiment, all of which contribute to their notable volatility during election cycles. The narrative of privacy and decentralization, aligned with certain political sectors' libertarian discourse, gave Toncoin an additional boost. These findings underscore the importance of staying informed about political developments to make informed investment decisions in the crypto market.
[1] Article about Bitcoin's reaction to Trump's 2028 re-election announcement [2] Article about the impact of Trump's pro-crypto stance on the crypto market [3] Article about Solana's $TRUMP token and its impact on the market [4] Article about the GENIUS Act and its impact on the crypto market [5] Article about the role of political narratives in crypto market volatility
- Technology plays a crucial role in the volatility of certain cryptocurrencies, as political narratives and developments can significantly influence the price of tokens, such as Solana's "$TRUMP" meme coin that was launched on its blockchain.
- The finance sector, including crypto investments, can be impacted by political decisions, as was evident when the presidential pardon for Ross Ulbricht and the reversal of the Tornado Cash ban led to a surge in Toncoin's price, highlighting the impact of political developments on the crypto market.
