In the weeks before the 2024 US presidential election, Bitcoin markets presented traders with a puzzle. Options desks were charging noticeably more for contracts expiring around the vote, signalling expectations of a sharp move — yet near-dated implied volatility stayed strangely quiet right up to election day. A series of Bitfinex Alpha reports published around the vote documented that tension, and the picture they painted remains one of the clearest case studies of how political uncertainty feeds through into cryptocurrency prices.
This guide walks through what Bitfinex analysts expected before the election, what the options and fund-flow data showed, how the market behaved once the result was known, and the practical risk-management approaches investors use to navigate election-driven turbulence.
What Bitfinex expected before the vote
In Bitfinex Alpha “Volatility Incoming” — Issue 128, dated 28 October 2024 — analysts reported that anticipation around the election had fueled a surge in options activity. Options expiring on key dates around the vote were commanding higher premiums, with implied volatility expected to peak at 100 daily vol on 8 November 2024, just after Election Day. In the report’s words, this indicated that “the market is bracing for potential turbulence”.
Crucially, the report framed this as a short-term phenomenon: volatility was expected to run higher than usual regardless of the election outcome, while the authors remained “confident in longer-term price appreciation” for Bitcoin.
The calm before the storm
A week later, Bitfinex published a follow-up Alpha report titled “Calm Before the Storm?”, dated 4 November 2024. It observed that front-end implied volatility — the pricing of options with the earliest expiries — was “unusually subdued up to election day (November 5th)”. Bitfinex interpreted that muted reading as a sign that investors were “holding back, waiting for the dust to settle.”
The subdued front end did not mean the storm had been cancelled. The report said a spike in volatility was still expected between 5 and 8 November 2024, and that this spike could either fuel big moves or, if it failed to materialize, signal a deeper market caution. Crypto Economy’s summary of the report described that window as crucial because of the election results.
Coverage elsewhere reinforced the same picture. Cointelegraph reported that Bitfinex analysts saw implied volatility for Bitcoin options trading in the “low 40s”, suggesting a lack of market confidence in significant price movements, and quoted them directly: “Despite a general expectation for heightened volatility leading up to the day of the US elections on 5th November, many market participants seem hesitant to take action, adopting a wait-and-see approach.” Even so, the analysts still expected “a massive spike in volatility” in the immediate aftermath of the vote — one that could fuel large price moves or, if it failed to appear, signal a risk of a deeper correction for Bitcoin on lower timeframes. CryptoSlate’s coverage of the same report noted implied volatility hovering around the low 40% range and a projected surge in volatility between 5 and 8 November 2024, with the possibility of sharp price movements during election week.
What the wider market was pricing in
Reuters reported on 1 November 2024 that investors had invested significantly in funds tracking Bitcoin in anticipation of a possible return of Donald Trump to the presidency, even while expecting substantial price fluctuations during election week. The same report cited Deribit derivatives data showing forward-implied volatility consistent with possible daily Bitcoin price moves of about 3.7% in either direction until 8 November 2024.
Bitfinex analysts also spelled out how they thought the result itself might cut. “The general consensus for markets is that a Republican victory is good for risk assets, and less so if there is a Democrat victory,” they explained in comments carried by Bitcoin.com News. “We expect volatility to be high in the first 10 days of November, leading up to and following the election,” they added, with scope for either a “sell-the-news” event or a “buying climax” resulting in a large move up. The same coverage highlighted “low front-end volatility” as reflecting a “cautious” market stance, while warning that a last-minute surge in volatility could signal rising activity as the election approached.
A “perfect storm” of converging catalysts
Election week did not arrive in a vacuum. According to a Bitfinex Alpha report covered by CryptoSlate, election uncertainty, the “Trump trade” narrative and historically favorable fourth-quarter seasonality were combining into what Bitfinex called a “perfect storm” for market movement. Analysts expected option premiums and anticipated daily volatility for both the US stock market and Bitcoin to rise as election results were awaited around 6–8 November 2024.
Political catalysts earlier in the cycle
Not every political event was expected to move Bitcoin. In June 2024, Bitfinex analysts assessed that Bitcoin’s price was unlikely to be significantly affected by the outcome of the 27 June 2024 US presidential debate between Joe Biden and Donald Trump, according to Crypto Briefing. Their reasoning: both candidates had “well-documented stances on cryptocurrencies and financial regulations”, and those positions were already “factored in” by the market. So-called “PolitiFi” tokens linked to the candidates, however, could see short-term changes.
How the market behaved after the vote
Once the result was in, the feared turbulence gave way to something steadier. NewsBTC, citing a Bitfinex Alpha report, wrote that analysts observed the Bitcoin market remaining “relatively stable” despite increased speculative activity, and that the ensuing rally “highlights the positive reaction to the election outcome, with investors positioning themselves for potential economic stimulus and regulatory shifts.”
The longer arc proved bumpier. In a subsequent Alpha report covered by CryptoSlate, Bitfinex noted that Bitcoin’s price slid in the first quarter after the election on a “sell-the-news” dynamic, with traders reassessing the lack of tangible regulatory progress after President Donald Trump took office. Liquidity remained tight, and volatility compressed following an early-year spike.
Managing risk when politics moves the market
Election periods create complex trading environments. The approaches below focus on limiting downside and staying flexible rather than predicting outcomes.
Options hedging
- Use Bitcoin options contracts to limit potential downside exposure.
- Implement protective put options to secure minimum price levels.
- Configure multi-leg option strategies for more complex risk management.
Volatility trading discipline
- Monitor implied volatility indicators rather than spot price alone.
- Set stop-loss orders at predetermined price levels.
- Reduce position sizes during periods of high uncertainty.
- Allocate smaller portfolio percentages to high-risk cryptocurrency positions.
Technical analysis toolkit
- Track short-term moving averages.
- Analyze resistance and support price levels.
- Use the Relative Strength Index (RSI) for momentum assessment.
- Apply Bollinger Bands to understand price volatility ranges.
Diversification
- Distribute investments across multiple cryptocurrency assets.
- Include traditional financial instruments such as stocks and bonds.
- Consider stablecoins for portfolio stabilization.
- Explore tokenized treasury assets for balanced exposure.
- Spread investments across exchanges operating in varied regulatory environments, balancing exposure between developed and emerging cryptocurrency markets.
Frequently asked questions
Why were markets braced for volatility around the US election?
Options expiring on key dates around the election were commanding higher premiums, with implied volatility expected to peak at 100 daily vol on 8 November 2024, according to Bitfinex’s “Volatility Incoming” report. Analysts read this as the market pricing in potential turbulence around the result.
Did the expected volatility spike arrive?
Ahead of the vote, front-end implied volatility stayed “unusually subdued up to election day (November 5th)”, while Bitfinex still expected a spike between 5 and 8 November 2024. Afterward, analysts described the market as “relatively stable” despite increased speculative activity, with a rally reflecting the positive reaction to the outcome.
What strategies help during election-driven uncertainty?
Common approaches include options hedging to cap downside, tighter position sizing and stop-loss discipline, technical indicators such as the Relative Strength Index (RSI) and Bollinger Bands to track momentum and volatility, and diversification across cryptocurrency assets, traditional instruments, stablecoins and jurisdictions.
The bottom line
The 2024 US election showed how much information sits in derivatives markets before a major political event: elevated premiums on election-week expiries, subdued front-end volatility, and a clearly flagged window — between 5 and 8 November 2024 — when analysts expected the storm to break. For investors, the lesson is less about predicting the result than about preparation: watch what options markets are pricing, size positions for turbulence, and keep a plan for both the “sell-the-news” and “buying climax” scenarios that analysts laid out ahead of the vote.