While Polymarket led with $3.3 billion in betting volume during the election, Kalshi’s legal win against the CFTC allowed it to hit $250 million in trading by Nov. 5. After the election, Galaxy Digital saw a record trading day because of Bitcoin surging to $76,500 and ETH's jump. Crypto stocks also rallied, and World Liberty Financial saw unrealized gains from ETH’s rise despite its limited token liquidity. This was driven mostly by the increasing optimism around pro-crypto sentiment in Congress and Trump’s election victory.
Kalshi Rolls Out New Markets for Post-Election Betting
Prediction marketplace Kalshi expanded its offerings for betting on United States political events to try and maintain high user engagement after the Nov. 5 presidential election. The contracts cover a variety of potential outcomes related to Donald Trump’s administration, including appointments and the likelihood of impeachment, according to filings with the U.S. Commodity Futures Trading Commission (CFTC).
In the lead-up to the election, political prediction markets experienced a surge in betting activity. In fact, these prediction platforms saw total betting volumes close to $4 billion by election day.
Some new election-related contracts on Kalshi (Source: Kalshi)
Web3-native platform Polymarket was the most popular venue after it attracted about $3.3 billion in presidential betting volume, according to its website. However, Kalshi, which is a U.S.-based derivatives exchange, quickly gained traction after introducing political event contracts on Oct. 7 after a court ruling that allowed the platform to list these unique markets. This ruling was the first time a political prediction market was allowed to operate legally in the United States.
Kalshi’s flagship market focused on the U.S. presidential election, and it achieved over $250 million in trading volume by Nov. 5. To try and appeal to crypto-savvy users, Kalshi also started accepting deposits in USD Coin (USDC) on Oct. 28. The marketplace expanded its offerings even more to include contracts for betting on upcoming elections in other countries, including Canada and Ireland, according to additional CFTC filings.
Kalshi’s legal victory against the CFTC came after the regulator initially prevented the platform from listing political event contracts. It argued that these kinds of prediction markets pose risks to the integrity of elections. The CFTC also criticized the district court’s decision by saying that the judge had “erred at every turn” by allowing Kalshi to trade in election odds. Despite these regulatory objections, many analysts argued that prediction markets actually very often capture public sentiment a lot more accurately than traditional polling methods.
Several other major trading platforms also wanted a piece of the political betting arena. Robinhood launched presidential election betting contracts for select users in late October, and Interactive Brokers followed suit by introducing its own election betting markets.
Crypto Advocates Gain Ground in U.S. House Races
In the 2024 United States election, Republicans managed to narrow the gap in the House of Representatives and secured key wins that could impact future crypto regulation. According to the Associated Press, Republican Jeff Hurd won Colorado’s 3rd congressional district race with 50.1% of the vote and 89% of votes counted. Incumbent Republican Scott Perry retained his seat in Pennsylvania’s 10th district after defeating Democrat Janelle Stelson. Perry has shown a lot of support for crypto regulation, and also voted for the bipartisan FIT21 bill that focuses on financial technology advancement. Hurd also seems to have similar plans to back crypto-supportive legislation.
Pro-crypto Facebook post from Jeff hurd (Source: Facebook)
Both Hurd and Perry were endorsed by Stand With Crypto, which is a political initiative advocating for pro-crypto candidates. This election cycle saw some impressive backing for pro-crypto candidates. Crypto-friendly PACs like Fairshake invested hundreds of millions of dollars to support congressional races.
While Republicans also won control of the White House and Senate, the House remains undecided, with AP calling 210 seats for Republicans and 194 for Democrats as of the latest updates. A majority requires 218 seats. Stand With Crypto claimed that the new Congress will be “the most pro-crypto ever,” as there could be a stronger presence of lawmakers in both chambers who support crypto-focused policies.
On the other hand, there are still some crypto critics in Congress, and they are still quite influential. Elizabeth Warren retained her Senate seat in Massachusetts after defeating John Deaton. Meanwhile, SEC Chair Gary Gensler, whose term extends to 2026, could face challenges ahead as President-elect Donald Trump pledged to replace him immediately after taking office. With pro-crypto sentiment growing in Congress, the direction of crypto policy in the United States is sure to be a hot topic of debate.
Galaxy Digital Rides Crypto Wave After Trump Victory
Galaxy Digital, the crypto trading firm led by Michael Novogratz, recorded its largest trading day of the year on Nov. 5, after Donald Trump’s victory in the presidential election. Novogratz told Bloomberg that the firm was operating at full capacity, and was handling trades with both domestic and international partners and managing activities across its lending and derivatives desks. He described the moment as a validation of Galaxy’s efforts in the crypto space.
Novogratz’s personal net worth also reportedly surged by 15%, or $600 million, to reach $4.6 billion, according to the Bloomberg Billionaires Index. The broader crypto market also experienced a huge uptick after Trump’s win stirred optimism for the sector’s future.
Michael Novogratz’s wealth increase (Source: Bloomberg)
Bitcoin’s (BTC) price jumped to a peak of $76,500 on Nov. 6, while Ethereum (ETH) jumped 10%. U.S. spot Ether ETFs saw $52.3 million in net inflows, which was a six-week high for the funds. iShares Bitcoin Trust (IBIT) also experienced a record trading volume of $4.1 billion on Nov. 6.
U.S. crypto stocks saw major gains as well, and many achieved double-digit growth. Analysts are now speculating about a potential bull run for Bitcoin after a prolonged period of “re-accumulation.” Rekt Capital suggested that a weekly close above $71,500 could trigger a breakout from Bitcoin’s re-accumulation range, which could potentially lead to further upward momentum.
Despite Trump’s win, Novogratz still shared that he has a more bipartisan approach to crypto. Although he didn’t publicly support Trump, he still plans to advocate for the industry.
ETH Surge Boosts Trump-Linked World Liberty Financial’s Funds
Other companies also enjoyed success after Trump’s win. World Liberty Financial, a decentralized finance (DeFi) project linked to the family of Donald Trump, saw $1 million in unrealized gains despite a muted token sale last month. Initially, the company wanted to raise $300 million but cut its target to $30 million on Oct. 31 because of low investor interest. So far, it sold close to 1.02 billion WLFI tokens, which allowed it to achieve about half of this new target.
The project managed to benefit from the recent crypto market rally driven by Trump’s election victory, especially as ETH surged since early Wednesday. This price increase raised the project’s funds from $15.3 million to $16.25 million. Etherscan data shows that the sale wallet currently holds 4,234 ETH and $4.2 million in stablecoins. World Liberty Financial has not sold any of these tokens.
ETH price action over the past week (Source: CoinMarketCap)
One challenge still facing World Liberty Financial is the non-transferrable nature of the WLFI token. This means that investors are currently unable to trade or liquidate it. Any future decision to change this will require a governance vote, though no timeline has been provided for this at all.
