(Bloomberg) -- A rally in Bitcoin paused as traders evaluated whether an improving regulatory outlook in the US and rising exchange-traded fund inflows will be sufficient to spur further gains.
The digital asset dipped about 1% to $65,445 as of 7:28 a.m. Tuesday in London. The token is still up roughly 9% in the past five days, beating an index of global shares as well as gold over the period.
Kamala Harris, the Democratic nominee in a tight US presidential race, on Monday pledged to support a regulatory framework for crypto with three weeks to go to election day. The vice president’s rival, Republican Donald Trump, has already embraced the digital-asset industry in the duel for votes. He’s viewed as the more avowedly pro-crypto of the two candidates.
The recent Bitcoin jump “is largely election-driven, initially from Trump’s lead in both prediction markets and polls, and later from semi-supportive statements regarding crypto markets from the Harris campaign,” said Noelle Acheson, author of the Crypto Is Macro Now newsletter.
Prediction markets have flipped of late, assigning Trump higher odds of victory than Harris. Trump has vowed to make the US the “crypto capital of the planet” — an about-face given that the former president previously dubbed the sector a “scam.”
The digital-asset industry has become an influential player in the presidential election through big donations to political action committees. Crypto businesses are seeking friendlier regulations, pushing back against a crackdown by the Securities & Exchange Commission under Chair Gary Gensler.
A group of 12 spot-Bitcoin ETFs in the US attracted $556 million in inflows on Monday, the highest since early June, according to data compiled by Bloomberg. They now have total assets of almost $62 billion.
Bitcoin on average delivered a 20% climb during October in the past decade, making the month the strongest of the year seasonally for the original cryptocurrency, data compiled by Bloomberg show.
“Historical data suggests that October’s seasonal strength in crypto markets is typically weighted toward the latter half of the month,” Sean Farrell, head of digital-asset strategy at Fundstrat Global Advisors LLC, wrote in a note.
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