Market Data 
Investing.com — Analysts at Bernstein believe that a Donald Trump win at the upcoming election “would be incrementally positive for and crypto market.” They note that broader support for crypto assets across both candidates addresses any existential risks, however, there could still be “a wide range of Bitcoin price outcomes in the near term.”
In a Wednesday note to clients, Bernstein analysts discussed the recent divergence in odds at Polymarket – the largest election prediction market, with over $1.5 billion in betting volume on the U.S. presidential race – and assessed the Bitcoin price impact.
1) ‘The Polymarket Odds:’ The betting dynamics on Polymarket have shifted notably in Trump’s favor following his rally with Elon Musk in Butler.
Trump’s odds spiked by 6% in 24 hours, surpassing Harris, who had led the market for weeks. This shift contrasts with national polls, where Harris still holds a slight advantage, highlighting a major divergence between betting markets and polling data.
2) ‘What Do the Polls Say?:’ Despite Polymarket’s movements, traditional polls tell a different story. The race remains “neck to neck,” with Harris leading by 3% on average.
“Nate Silver’s Bayesian model which takes recent polls as inputs to determine a trend, is now giving a 3% lead to Harris, but in his commentary continues to suggest a ‘close race’,” Bernstein notes.
3) ‘Swing State Markets:’ Trump has a clear lead in key swing states on Polymarket, including Arizona, Georgia, and North Carolina, with gaps exceeding 20%. In Pennsylvania, Trump’s lead surged to 9% after the Butler rally. Harris still holds a narrow lead in Michigan and Wisconsin, though these margins have tightened.
4) ‘Polls vs. Polymarket:’ Bernstein also points out a historical underestimation of Trump by polls, as seen in 2016 and 2020. This raises the question of whether the polling lead for Harris should be wider for a more decisive victory.
Polymarket had reflected Harris’ polling advantage until the recent Trump surge, marking the first significant divergence since the Harris nomination.
5) ‘Is Polymarket Trump Biased?:’ In the note, Bernstein analysts also discussed the possibility of a pro-Trump bias, considering Polymarket’s blockchain infrastructure and Trump’s pro-crypto stance.
However, the firm argues that the liquidity and volume of bets make it unlikely that the market is skewed purely by bias.
“The liquidity is fairly robust now for it to indicate any biases or attempts to manipulate the market. This was evident in Harris’s odds being ahead of Trump all this while except the recent Trump divergence,” analysts said.
Moreover, given that crypto investors are already long crypto, they are more likely to support Harris as a hedge.
“Thus, we would rather expect more Harris demand from crypto investors. Further, Polymarket would have bettors beyond crypto investors for the kind of volume being traded,” Bernstein added.
6) ‘What Should One Do with Bitcoin and Other Crypto Assets?:’ Bernstein maintains that Bitcoin stands to benefit regardless of the election outcome, driven by low interest rates and U.S. fiscal deficits.
Still, it believes a Trump win could push Bitcoin to new highs between $80,000 and $90,000, while a Harris victory could see it drop to the $40,000 range. The market is likely to remain reactive to election odds until greater clarity emerges.
