- The stock market price action and polls ahead of U.S. elections indicate a Biden victory.
- However, a delay due to a tie or close results threatens global markets much worse than a clear win of either candidate.
- Bitcoin options traders hedged $370 million for options contracts expiring Friday.
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While Joe Biden looks strong to replace Donald Trump as the President of the United States, all markets, including Bitcoin, would prefer a clear winner far more than a contentious deadlock.
Bitcoin and Global Markets Fear a Close Result
It is a week when traders expect Bitcoin to move in lockstep with the traditional markers as both candidates represent a similar fate for BTC’s future.
The eight swing states in the U.S.—Florida, Pennsylvania, Ohio, Michigan, North Carolina, Arizona, Wisconsin, and Iowa—still retain the power to sway either side’s results.
Among them, Florida is the most crucial state, which comes out today at 8 pm EST. The other key swing states for the Republican party are Wisconsin and Michigan, while Democrats winning in North Carolina and Georgia will be key for a Biden victory.
A close voting outcome would delay the final result and begin another round of contest between Biden and Trump in the senate or via lawsuits.
Further, America elects its president based on the result of state-wide electoral college rather than popular votes. This is what secured Trumps’ victory over Hilary Clinton in 2016, despite losing the majority.
The expected time for a final result is due Wednesday. However, a close victory or delays due to lawsuits could delay it for a week, which could be problematic for the stock markets given trader’s disliking for uncertainty.
Crypto Market Sentiments
Bitcoin posted gains of 1% Tuesday rising to $13,700 as voting began. However, a negative funding rate for Bitcoin perpetual swaps indicates a slightly bearish inclination among futures traders.
Moreover, about $370 million in Bitcoin options expire this Friday, suggesting a large hedge against election outcomes.
Put orders or sell options expiring on Nov. 6 dominated the options market today, betting around 2,150 BTC, worth $29 million, on a downtrend.
The options market gives a 53% probability of BTC price maturing above $13,500 by November end.
Nevertheless, the spot exchanges’ mean inflow indicator below 0.2 suggests that whales in the U.S. spot exchanges are not active. Low inflows to exchanges point towards strong hands by holders reluctant to sell.
Heading into the election week, Bitcoin derivatives traders are preparing a hedge against flash crashes, as spot holders are showing signs of strong hands. The results of this week’s election may, however, not be as influential as some expect.
Alex Mashinsky, the CEO of Celsius Network, shared with Crypto Briefing:
“The global economy is going through a slow motion recession, as the demand for goods and services is slowing down. Meanwhile the central banks pump liquidity to try and reverse this trend. All of this is not good for GDP or for our employment rates. No matter who wins we will have a severe recession in the next 2-3 years.”
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