The recent attack on pro-crypto presidential candidate Trump is expected to stimulate interest in cryptocurrencies, according to one analyst.

Bitcoin (BTC) has climbed to over $62,000 following the incident, which has increased the likelihood of Trump’s election victory.

Currencies like the yuan and Mexican peso are showing weakness, while Treasury futures indicate rising yields.

Assets associated with U.S. Republican candidate Donald Trump’s chances of winning the November 4 elections are experiencing heightened volatility after an attempted assassination of the former president on Saturday.

Since the weekend attack, Bitcoin (BTC) has surged 7% to $62,500. This event has raised the pro-crypto candidate’s election probability to 70% on Polymarket.

The leading cryptocurrency has surpassed the significant 200-day simple moving average (SMA), a key indicator of long-term trends, and has broken a downtrend line from early June highs, indicating positive momentum for traders, according to CoinDesk data. Trump-themed Polifi tokens, which blend politics and finance, have also seen a rise.

In recent months, Trump has shifted his stance and embraced cryptocurrency to gain an edge over his rival, Joe Biden, and attract the crypto community, which desires a more favorable regulatory environment for the industry. Consequently, Bitcoin and the broader crypto market are now seen as investments linked to Trump’s potential victory. The former president is set to speak at the Bitcoin 2024 conference in Nashville, Tennessee, on July 27.

“The biggest fundamental news over the weekend was the Trump assassination attempt. Absolutely insane. This has improved the odds of a Trump presidency. Trump being the pro-crypto president should help galvanize the cryptocurrency bids,” Greg Magadini, director of derivatives at Amberdata, said in an email.

BTC’s daily chart (TradingView) (TradingView)

Meanwhile, the Chinese yuan (CNY) weakened against the U.S. dollar as a potential Trump victory could lead to higher trade tariffs. Earlier this year, Trump suggested revoking China’s “most favored nation” status for U.S. trade and imposing tariffs of over 60% on Chinese goods. The Mexican peso (MXN) also fell due to Trump’s strained relations with the Latin American nation during his previous presidency.

Futures prices for the 10-year Treasury note dropped, suggesting higher yields, as Trump’s return to the White House would likely mean increased spending, tax cuts, and larger budget deficits. Several investment banks predict that a potential Trump victory would steepen the currently inverted yield curve in the coming months. Historically, sharp steepening has led to widespread risk aversion in financial markets.

Futures linked to the S&P 500 were up 0.18% at the time of writing, indicating a positive opening on Monday, even as Asian stocks declined due to disappointing economic growth figures from China. The dollar index, which measures the greenback’s value against major fiat currencies, was 0.10% higher at 104.19, according to TradingView.

Source: Coindesk