The "Trump Trade" took a hit

The price of bitcoin began falling during last night's presidential debate, losing almost 4% by the time it hit its low this morning.

Why it matters: Bitcoin has been seen as a proxy bet on the election, with traders assuming a win for former President Trump would boost the price of the oldest cryptocurrency.

The price started falling almost as soon as the debate began.

• As it did, so too did Trump's odds of winning the White House on the most popular blockchain-based prediction market, Polymarket.

The big picture: Bitcoin is one of several assets linked to the "Trump Trade," an evolving term used to describe bets that would benefit from the former president's economic policies — primarily deregulation and tax cuts.

• But Trump has gone all-in on crypto, and bitcoin in particular, making the asset one of the headliners for the Trump proxy trade.
• Truth Social, Trump's social media app and the asset most closely tied to Trump's election fortunes, also took a beating after the debate. Its owner, Trump Media & Technology Group, traded down over 10% today. (See below)
• And the U.S. dollar, another asset linked to the Trump Trade, also softened during the debate, though it has since rebounded.

Reality check: Many other macro factors are influencing asset prices, including that of bitcoin.

The bottom line: While bitcoin has climbed back to where it traded before the debate (Trump's odds on Polymarket have clawed back a bit, too), it's still down 15% from its level prior to President Biden's withdrawal from the race.

• The odds of Trump winning have fallen 16 percentage points on the site over the latter time frame.

Go deeper: For more on digital asset markets, policy and regulation, follow Axios Crypto.