30s Summary

The US presidential race is causing increased volatility in the cryptocurrency market with experts suggesting this indicates a higher risk around the election. Bitcoin’s volatility index has hit a July high on trading platform Deribit, and its price has also experienced large swings. Traditional markets are also affected, with the Ice BofA Move index noting its highest point since October 2023. The Euro to Dollar exchange has also seen a year-high in volatility. These swings can tighten liquidity and cause traders to retract from riskier assets like cryptocurrencies.

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Cryptocurrency traders are seeing more swings than usual for Bitcoin as the American election race heats up. Deribit, a major Bitcoin trading platform, reports their Bitcoin volatility index has hit its highest level since July. Additionally, the Euro to Dollar exchange is hitting one-year high levels in volatility, alongside U.S. Treasury notes.

Market experts are suggesting that these sudden peaks indicate increased risk around the U.S presidential race. There’s a fairly even split between odds of Republican candidate Trump or Democrat candidate Harris winning, especially in critical swing states. This uncertainty has the potential to nudge Bitcoin one way or the other.

We saw this possibility play out this past week when Bitcoin near-toppled its record high, reaching $73,500, largely due to rising odds that Trump would win the race. Unfortunately for Bitcoin, Trump’s chances took a turn for the worse, and Bitcoin prices fell to below $68,000.

Over in traditional financial markets, we’re also seeing a lot of movement. The Ice BofA Move index – a measure of 30-day implied volatility in Treasury notes – reached its highest point since October 2023. This kind of volatility brings a tightening of liquidity, and causes traders to pull back on riskier assets, one of them being cryptocurrencies.

Moreover, in the foreign exchange market, the most traded currency pair (the euro and the U.S. dollar) witnessed a high level of volatility unseen since the mini U.S. banking crisis in 2023.

That’s the scoop for now! Keep your eyes open for more fluctuations as the world waits for the U.S presidential election results.