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 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.
Crucially, the report framed this as a short-term phenomenon. “Regardless of the election outcome, short-term volatility is expected to be higher than usual,” the analysts wrote in the full Issue 128 report, while remaining confident in longer-term price appreciation for Bitcoin.
The calm before the storm
A week later, Bitfinex followed up with an 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 right up to election day on 5 November 2024, a sign that investors were holding back and waiting for the result. CryptoSlate’s coverage of the report noted Bitcoin’s implied volatility in the options market hovering around the low 40% range, reflecting restrained confidence in major price moves, alongside a projected surge in volatility between 5 and 8 November 2024 and the possibility of sharp price movements during election week.
The subdued front end did not mean the storm had been cancelled. Bitget’s summary of the report captured the same tension: Bitcoin volatility was low as the US presidential election approached, with Bitfinex anticipating increased market activity after the results.
A convergence of catalysts
Election week did not arrive in a vacuum. Bitfinex analysts pointed to election uncertainty, the Trump trade narrative and historically favorable fourth-quarter seasonality converging in the same window, and expected option premiums and anticipated daily volatility for both the US stock market and Bitcoin to rise as the election results were awaited.
How the market behaved after the vote
Once the result was in, the feared turbulence gave way to something steadier. Bitfinex analysts observed the Bitcoin market remaining relatively stable despite increased speculative activity, and read the ensuing rally as a 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, 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, while Bitfinex still projected a surge between 5 and 8 November 2024. Afterward, analysts described the market as remaining relatively stable despite increased speculative activity, with the ensuing rally reflecting a 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 ready for the scenarios analysts flag before the vote.