Biden's Shocking Announcement

President Joe Biden moved the crypto markets by announcing his decision to no longer seek reelection. He bowed to weeks of pressure after a disastrous debate with running rival Donald Trump.

The price of Bitcoin reacted to the news with a 2.8% plunge, but it has since bounced back to over $67,000, according to Coinmarketcap and Kucoin data.

Mixed Reactions from Analysts

Describing Biden's sudden move as a win for crypto assets, eToro market analyst Josh Gilbert told Cointelegraph that Trump's heightened chances of reelection represent a massive boost for the asset class.

"The longer that we see Trump staying ahead in the election odds, the more crypto assets will price in his victory," Gilbert added. However, some analysts say the recent Biden development may lead to a gradual surge for crypto.

Trump's Pro-Crypto Stance

Trump recently focused on Bitcoin and crypto topics in his reelection campaign. On June 14, he declared that if elected president, he would end the Biden administration's war on crypto.

10X Research head of research Markus Thielen suggested that a crypto-friendly Trump presidency could see Bitcoin become further adopted as a strategic reserve asset.

Potential Impact on Bitcoin and ETFs

In a July 21 report, Thielen wrote that the US government holds just 212,800 BTC, roughly $15 billion worth, while it holds around $600 billion in gold reserves.

If the government were to double its Bitcoin holdings, the price impact of net inflows into spot Bitcoin exchange-traded funds (ETFs) year-to-date would be ** nearly equivalent **.

Looking forward, Gilbert said he expects to see the price of Bitcoin drive higher, citing the upcoming launch of spot Ether (ETH) ETFs in the US as one of the main catalysts for growth across the market.

Caution and Skepticism

However, Swyftx analyst Pav Hundal warned that while Biden's withdrawal could boost Trump's chances, it would be difficult to draw a direct link between this and the current bounce in price action in the broader crypto market.

"Learning from the Bitcoin ETF experience, we could see a temporary stalling of prices before the uptrend continues," he said. Gary Black, Managing Partner at The Future Fund, also warned that a Trump presidential victory was far from a done deal. "Those who think Trump/Vance will win by a landslide are getting ahead of themselves," Black said in a July 22 post to X.

Future Uncertainties

Black added, "The American public doesn't trust Trump after the events of January 6. I was no fan of Biden or Kamala, but Democrats could still nominate Newsom, Michelle Obama, or another leading Democratic candidate as their Presidential candidate."

It's too early to be convinced of a second Trump Presidency. Investors are advised to remain cautious and calm in the short term.