Bitcoin To Benefit From Hashrate Rise, Inflation Fears, Crypto-friendly President

After encountering resistance at $69,500, Bitcoin fell by 4.1% between October 21 and 22. This correction wiped out the previous week's gains, leaving traders to question whether the $67,000 level could be recaptured and what factors would support a reversal.

The S&P 500's fall from its peak on October 18 has pushed Bitcoin (BTC) investors to be more cautious. However, the main drivers behind the stock market's return are largely favorable to alternative assets. Gold, for example, hit an all-time high on October 22.

Bitcoin will benefit regardless of the outcome of the United States presidential election.

Billionaire hedge fund manager Paul Tudor Jones told CNBC on October 22 that the US government will continue to monitor inflation “no matter who ends up in the White House.” In this case, Tudor Jones recommends gold and Bitcoin, emphasizing that most investors are not “ridiculously” exposed to commodities.

Tudor Jones estimates that the US public deficit will exceed current budget projections, suggesting that long-term Treasury yields will increase as “the US finally tries to increase its output.” In this case, a stock market crash is not imminent, but the US dollar may experience a significant depreciation.

Although this is not the first time that the founder of Tudor Investments has praised the value of Bitcoin, when BTC trades near $69,000, it sends a significant signal confirming its position. A sharp rise in the US 10-year Treasury yield reflects doubts about the Federal Reserve's “soft landing”.

Even amid macroeconomic uncertainty, the fundamentals for a sustained bitcoin rally remain intact. For example, increased demand for gold shows a lack of confidence in the stock market even as technology companies report record earnings. Gold, traditionally seen as a hedge, shares this key value with Bitcoin.

While it's impossible to predict the outcome of the US presidential election, Blockchain Association CEO Christine Smith believes the upcoming US Congress will be more crypto-friendly than ever, noting that “many first-time candidates will come with a position on crypto.” He said. Additionally, there seems to be a growing number of legislators and policymakers open to discussing digital assets.

Bitcoin to take advantage of Hashrate's growth and investors' interest in alternative assets

Strong demand in Bitcoin exchange-traded funds (ETFs) supports the possibility of BTC retracing the $67,000 level. As of October 11, these instruments saw net inflows of $2.68 billion, pushing assets under management in ETFs to $51.7 billion, according to data from Farside Investors and CoinGlass.

Related: SEC Lists Crypto as Investigation Priority in 2025

The ever-growing Bitcoin hashrate, which measures the total processing power used by the network's validators, suggests that miners are bullish in the medium to long term.

A higher hashrate implies a significant investment in ASIC mining equipment, a process that takes 18 months or more to achieve profitability. With short-selling pressure from miners easing, it will be easy for Bitcoin to regain momentum and establish $67,000 as a support level.

This article is not intended for general information purposes and should not be construed as legal or investment advice. The views, ideas and opinions expressed herein are solely those of the author and do not necessarily represent the views and opinions of Cointelegraph.