Crypto could become the predominant “Trump Trade” this election cycle as Republican prospects improve and the party’s leader increasingly supports a pro-crypto stance, Bernstein analysts suggested.
According to a Bloomberg report on Tuesday, Bernstein analysts wrote that Republicans believe supporting crypto is a strategy to appeal to voters. They also see it as a way to secure campaign funding from super PACs aligned with pro-crypto politicians.
The term “Trump trade” describes Donald Trump’s economic policy characterized by protectionism and nationalism. It is what he promoted during his 2016 presidential campaign and implemented as president. It also denotes the concurrent rise in US stocks, Treasury yields, and the dollar that occurred after Trump won the 2016 presidential election, according to Bloomberg.
Crypto Set for Surge if Trump Prevails: Bernstein
Bernstein said that if Trump wins again, it would likely trigger a crypto rally supported by increased institutional adoption and a more favorable regulatory environment.
“The Republican side sees crypto not just as a vote bank but also a meaningful source of funding,” Bernstein analysts wrote. “If the election sentiment shifts more Republican, crypto would end up as the primary ‘Trump trade’ and hopes of a favorable regulatory regime would change the ‘use-case’ narrative around blockchains.”
Trump’s Campaign Welcomes Crypto Donations Amid Industry Support
The report comes after a number of prominent supporters expressing their backing for Trump. Ark Invest CEO Cathie Wood recently disclosed her intention to vote for Trump over President Joe Biden in the upcoming election.
Meanwhile, Blackstone CEO Stephen A. Schwarzman has indicated his endorsement of Trump as a vote for change. Additionally, the billionaire Winklevoss twins pledged $1m each in Bitcoin to support the Republican presidential candidate.
Trump has started accepting crypto donations for his campaign since last month, showing support for the industry. He’s also hinted he would ease up on US crypto hostility if re-elected. His recent embrace of cryptocurrency seems self-serving, considering his past skepticism.
According to a report from TD Cowen, despite his recent pro-crypto stance, Trump might become skeptical about cryptocurrencies again if elected.