Cryptocurrency analysis firm QCP Capital is pointing to a potential historical parallel between Bitcoin’s recent price surge and the upcoming US presidential election. In a market update today, QCP Capital highlighted Bitcoin’s jump from $62,000 to $65,000, triggering the liquidation of approximately $80 million in leveraged BTC and ETH positions.
While the firm acknowledges several potential factors contributing to the rally, they draw attention to the timing, noting the striking similarity to price action observed in the lead-up to the 2016 and 2020 US presidential elections. In both instances, Bitcoin experienced a period of relative stagnation before surging dramatically in the three weeks preceding the election. In 2016, Bitcoin climbed from $600, doubling in price by January; in 2020, it rose from $11,000 to reach a high of $42,000 by January.
QCP Capital dismisses the recent postponement of Mt. Gox repayment deadlines (announced last Friday) as a primary driver of today’s gains.
This year’s “Uptober,” typically a bullish period for Bitcoin, has so far underperformed, with BTC showing only a 1.2% increase compared to the historical average gain of 21%. However, the current rally offers a “glimmer of hope,” according to QCP Capital, potentially signaling a repeat of past pre-election price increases.
With only three weeks remaining until the election, the firm suggests the market is poised for further movement. As spot prices continue their upward trend, the focus will likely shift to fourth-quarter profit targets, QCP Capital concludes.
