SUMMARY
- Asian markets and U.S. stock futures fell, with Bitcoin dropping over 2% to $56,300, signaling a shift to risk-off sentiment after the presidential debate.
- Dogecoin led the declines among major cryptocurrencies, while Trump-themed finance tokens saw significant losses.
- In contrast, Harris-themed tokens gained, reflecting market sentiment favoring her perceived debate performance.
Asian markets and U.S. stock futures experienced a recognizable downturn after the second presidential debate, where U.S. Vice President Kamala Harris was seen as outperforming previous President Donald Trump. Following the debate, Bitcoin (BTC), the leading cryptocurrency by market value, dropped over 2% to $56,300, according to CoinDesk data. This decline in Bitcoin was accompanied by a broader market pullback, with the CoinDesk 20 Index falling about 2.5%, demonstrating a shift toward risk-off sentiment. In spite of the losses, Bitcoin exchange-traded funds (ETFs) posted inflows for the second straight day, collecting $117 million, driven by Fidelity’s FBTC product, a reversal after a record losing streak.
Among major cryptocurrencies, Dogecoin (DOGE) driven the decay, sliding 4% in the past 24 hours, concurring to CoinGecko information. Other tokens like XRP, Solana’s SOL, Ethereum (ETH), and BNB saw small alter amid the same period, reflecting a mixed response in the crypto market. The broader cryptocurrency market followed the general trend of caution, as investors responded to the perceived result of the debate.
Traders on the betting platform Polymarket closely observed the odds between Harris and Trump, with Harris being pronounced the winner of the first debate. Earlier in the race, Trump had debated President Joe Biden before Biden stepped aside, endorsing Harris to carry the Democratic ticket. Trump’s comments amid the debate, particularly his defense of trade tariffs, weighed intensely on Chinese stocks, which fell to a seven-month low. In the meantime, futures tied to the S&P 500 lost 0.4%, further reflecting the market’s risk-averse stance.
The Japanese yen surged to 140.70 per U.S. dollar in the currency markets, its most noteworthy since January. The yen, often seen as a safe-haven currency, strengthened amid uncertainty, reflecting investor concerns over worldwide market stability. The yen has picked up momentum since the Bank of Japan hiked interest rates in late July, loosening up risk-on yen carry trades.
Political finance tokens also took a hit, with Trump-themed tokens such as the MAGA (TRUMP) token down 11.7% and Solana’s Doland Tremp (TREMP) token diving by 27%. In contrast, Harris-themed tokens, including the ‘Kamala Horris’ (KAMA) token, rose 7.6%, reflecting positive opinion around her debate performance.
Polymarket traders are betting on a 56% chance of another debate happening and a 27% chance that Trump will fire his campaign manager. Following the debate, Trump’s appearance on Sean Hannity’s Fox News show was seen by spectators as an affirmation of a weaker performance, raising further questions about his campaign’s trajectory.
The market’s reaction to the debate highlights the progressing effect of political events on financial markets, with investors adjusting positions in the midst of developing uncertainty.