Investing.com — Bitcoin has become a focal point of the US presidential campaign. Following the shift in Polymarket odds and polls in favour of Harris, the original cryptocurrency has been trading in a range, recently touching $61,000 before falling back to around $58,000.
Bernstein analysts expect the market to remain range-bound until the election picture becomes clearer, possibly closer to the presidential debates.
As for the cryptocurrency markets, Bernstein interprets current sentiment as bullish for Trump and bearish for Harris.
“The Trump-led Republican camp has made a strong appeal to crypto voters, promising favorable policies and even hinting at the creation of a national Bitcoin reserve,” Bernstein analysts said in a note on Monday. In contrast, while some Democrats have thrown their support behind cryptocurrencies, the broader community remains cautious and looking for more concrete action amid ongoing regulatory challenges.
The broker is also interested in seeing whether Polymarket’s blockchain-based liquid markets will provide more accurate signals than traditional surveys, which would mark it as a “true crypto killer app.”
Polymarket has emerged as the most liquid election exchange this U.S. election season, handling more than $500 million in bets and capturing more than 80% of market share, according to Bernstein.
Unlike traditional election polls, which are often criticized for bias, Polymarket is seen as more reflective of “what's at stake,” although its predictive power remains under scrutiny.
Bernstein argues that since Vice President Kamala Harris' nomination, the Polymarket trends have shifted in her favor. “Harris's odds began to rise after the first Biden-Trump debate on June 27 and increased further after her nomination on August 2,” Bernstein analysts wrote. So far, Harris's odds of winning the “Yes” vote have outpaced Trump's by more than 6%, with Harris at 52% compared to Trump's 46%.
Harris’s increased odds on Polymarket sparked unrest in cryptocurrency markets as Bitcoin struggles to reclaim its previous highs around $70,000. Some Republican supporters have dismissed Polymarket’s odds as a temporary “honeymoon phase,” arguing that the odds can be manipulated by significant bets.
However, Bernstein analysts believe Polymarket's odds simply reflect the momentum Harris has gained in recent polls, noting that the Project 538 average shows Harris leading Trump by 2.4%.
“Polymarket's odds are probably as good or bad as election polls in predicting the outcome,” they noted, adding that the real test will come after the presidential debates in September.
