Bitcoin’s Future May Depend on US Election Outcome

Investment bank Jefferies emphasized in its research report published yesterday that the political side of crypto emerged with multiple politicians, both Republican and Democrat, and former president Donald Trump attending the Bitcoin Nashville conference last week.

“Trump’s promise to introduce crypto-friendly regulators to the industry could lead to the near-term BTC price being tied to the outcome of the US presidential election,” analysts Jonathan Petersen and Joe Dickstein wrote.

Trump vowed during his speech in Nashville that he would protect the strategic bitcoin reserve and never sell government-seized bitcoins (BTC).

Jefferies recalled that Trump promised to choose crypto-friendly regulators, create a crypto industry presidential advisory council, and make the country the “crypto capital of the planet.”

This positive shift in Trump’s crypto policy is very recent, the bank noted, adding that it could affect the price of bitcoin in the near term, depending on who wins the election in November.

With bitcoin gaining about 5% since the halving in April and the network hashrate falling by a total of 8% in May and June, the analysts wrote that “mining profit margins were better than feared at the beginning of the year,” with mining revenue per exahash falling by 40-45% instead of 50%.

Jefferies notes that major bitcoin miners continue to grow and are working to increase their hashrate significantly, with the hashrate being an indicator of the competition in the industry and the difficulty of mining.

The report says that bitcoin mining is in a consolidation phase, with CleanSpark (CLSK) recently agreeing to acquire GRIID (GRDI) and Riot Platforms (RIOT) making a public offer for Bitfarm (BITF) that was later rejected.