On Jan 20, Donald Trump was inaugurated as the 47th President of the United States. With his return to power, Trump is planning to take immediate actions that are expected to dramatically change the country’s course.
“The golden age of America begins right now,” declared the 78-year-old Republican leader in his inaugural address, adding: “From this moment on, America’s decline is over.”
It was a big day for the cryptocurrency industry, as Trump made several promises during his campaign trail to promote innovation in the market and bring regulatory clarity. This drove almost $200 million in donations from the crypto industry to influence the outcome of the US elections.
However, the beginning of Trump’s second term saw a market rout, with prices falling across the board.
Trump’s entry into the White House was what the market expected it to be: a ‘sell the news’ event. The crypto market, after all, has been having a great time ever since Trump’s victory was announced in early November.
Another factor contributing to the sell-off was Trump’s failure to address cryptocurrency in his public statements or the executive orders signed in the Oval Office.
While there was no mention of crypto from Trump on his first day in office, which the White House is calling a “historic” one, the President has signed 42 executive orders, memoranda, and proclamation actions along with 200 executive actions.
This has been in contrast to the mainstream media reporting just days before the inauguration, when, on his first day back, Trump was expected to sign executive orders that would designate crypto as a national priority and create a crypto council.
So far, no such move has yet been made by the freshly inaugurated pro-crypto president. With no mention of crypto in his “America First Priorities,” the market is feeling down. However, there are four years ahead of crypto to see if all that Trump has promised to the industry would actually materialize.
For now, let’s take a deeper dive into how the market reacted to Trump’s first day in office and where it is standing right now!
Back to $100K, Bitcoin Reacts by Falling from ATH
On Monday, Bitcoin price fell hard and went back to almost the $100K mark. This drawdown, however, comes after Bitcoin made a new all-time high at almost $109,000 the same day. The new high helped Bitcoin overtake silver and become the eighth most valuable asset in the world.
Bitcoin price was propelled higher by institutional interest, which poured a total of $2.35 billion in Spot Bitcoin exchange-traded funds (ETFs) three days before Trump’s inauguration, according to data provided by Farside.
So far, Bitcoin ETFs have recorded $38.8 billion in cumulative inflows ever since they got approved and subsequently started trading about a year ago. These products now hold $120.95 bln in total assets, as per SoSo Value, with BlackRock’s BIT in the lead, having $59.28 bln in net assets and $38.4 bln in total inflows.
Amidst this situational interest, BTC price experienced a volatile Monday — starting the day above $106K only to fall under $100K, and then a few hours later, the largest cryptocurrency was back to making a new ATH, all in anticipation of Trump’s return.
Since then, BTC’s price has given back almost all of its gains as it trades at $101,305 at the time of writing, 6% off of its peak hit on Jan 20, 2025.
The decline in prices resulted in 238,378 traders being liquidated in the past 24 hours, with the total liquidations coming in at $638.06 million, which is nowhere close to the real numbers as exchanges like Binance don’t really post the exact liquidations, rather one per second instead of all. Meanwhile, the largest single liquidation order happened on Binance for BTCUSDT.
Bitcoin’s open interest, however, remains high at almost $66.3 billion, only slightly down from this month’s high of $66.74 billion on Jan 19 and not far from its peak of $70.76 bln on Dec 17. CME currently sits at the top with 191.59K BTC (worth $19.55 bln) in OI, followed by Binance’s 121.15K BTC ($12.40 bln) and Bybit’s 83.58K BTC ($8.53 bln).
Bitcoin’s latest sell-off actually comes after a 60% rally. Just a few months ago, Bitcoin was trading at around $68,000 when Trump won the US presidential elections. Before the month was over, Bitcoin had almost touched $100K. After consolidating over the next month, Bitcoin price started grinding above $100K towards new highs.
With that, the $2 trillion market cap of Bitcoin is now enjoying three consecutive green quarters so far, according to Coinglass. In Q1 of 2025, Bitcoin is still up 8.17%, which comes after 47.73% returns in Q4 of 2024 and 0.96% gains in the quarter before that.
Bitcoin’s returns this month are also above the historical average, which has been 3.72%. Unlike January, which has been a mixed bag for the largest cryptocurrency, February is historically a bullish month for Bitcoin, with the average returns in the month being 15.66%.
However, with Bitcoin just coming off making new highs and seeing positive price action since September except for a down (-2.85%) in December, it remains to be seen just how the crypto king will perform in the coming month.
Much of Bitcoin’s performance now depends on Trump keeping his promises. This includes a US strategic Bitcoin reserve, which, if it gets a green light, can see Bitcoin skyrocketing in no time. There has been no action from the president; meanwhile, we can see Bitcoin prices dragging down significantly.
The Polymarket currently puts the odds of a strategic Bitcoin reserve being created in Trump’s first 100 days at 30%, down from a high of 60% on Monday. Republican Senator Cynthia Lummis has also introduced the Bitcoin Act of 2024 to establish a reserve that holds 200,000 BTC.
With Bitcoin not part of Trump’s speech and GOP congressional priorities not having any mention of it either, the market can now only wait and watch.
Click here to learn all about investing in Bitcoin.
Ethereum Continues to Disappoint, No End in Sight
While Bitcoin had fun, at least before Trump came into office, the second largest cryptocurrency by market cap of $388.5 billion had no such luck. Ethereum continues to disappoint, being one of the worst-performing major assets.
ETH price has been down 3.6% in the past 24 hours and 2.37% in 2025 so far, which comes after recording only a 46% increase in its value last year and 90% the year before that. While Ether prices declined more than Bitcoin during the bear market of 2022, its recovery has been far slower than BTC.
In fact, ETHBTC slumped to its lowest level of 0.030 in almost five years, last seen in March 2021. Ether’s value against BTC topped above 0.08 in 2022, and ever since then, the ETHBTC ratio has been on a decline.
Ethereum has actually yet to make a new high. Currently, 33.4% off of its $4,880 ATH hit in Nov. 2021, during the last bull market. As of writing, ETH is trading at $3,250, making a red start to the new year. The 2.84% drawdown in January follows last month’s 9.75% decline in prices.
Not only is Ethereum underperforming Bitcoin, despite being the only other crypto asset to have an ETF, but it is actually doing far worse than its competitor, Solana. The $113 bln SOL made a new ATH at just above $293 on Jan 19 after Trump launched his meme coin on its blockchain.
OI in the Ethereum futures space, meanwhile, is standing at $30.19 bln, near its $31.16 bln high from Dec 17. In comparison, Solana’s OI has skyrocketed to $7.94 bln from the low of 4.44 bln late last month and $6.36 bln high from Jan 6.
One saving grace for Ether came in the form of World Liberty Financial (WLFI) accumulating ETH, which can be seen as an interest among institutions.
WLFI is a decentralized finance platform linked to Trump and his family, who championed the project on social media that purchased millions of dollars of cryptocurrencies hours before the President’s inauguration ceremony. It bought $47 mln of WBTC and $47 mln worth of ETH in addition to TRX, ENA, and LINK.
Ethereum’s ETF flow, however, is lackluster as always. Compared to Bitcoin’s hefty numbers, Spot Ethereum ETFs only managed to capture $251.4 million in inflows over a period of four days before Monday. In total, $2.66 billion have flown into these ETFs since they got approved in July last year. Their total assets, meanwhile, stand at $12.66 bln.
While BlackRok’s ETHA leads in terms of flows at $3.83 bln, Grayscale’s ETHE still holds the most assets at $4.89 bln.
Despite Ethereum’s weak price performance and equally disappointing ETF inflows, prolific trader GCR continues to believe in Ethereum, expecting it to hit $10,000 per coin by 2030. Others also believe that ETH would eventually pump much like the last bull market when it didn’t rally until the very last leg of the uptrend. At the same time, there are some who believe ETH “fell out of favor,” and that’s a new reality.
Market participants also believe that the Ethereum Foundation is to blame for the condition of crypto assets. Ethereum Foundation is a non-profit organization that supports the development of the second-largest cryptocurrency and related technologies.
Most recently, Ethereum co-creator Vitalik Buterin talked about the ongoing process of changes to the Foundation’s leadership structure. This includes improving technical expertise level and communication between EF leadership and the ecosystem, bringing in fresh talent, actively supporting app builders, and increasing decentralization and privacy.
Most importantly, Buterin mentioned a non-goal of executing “some kind of ideological / vibes pivot from feminized wef soy boy mentality to bronze age mindset.”
While the market is raising questions on EF leadership, Cobie, a well-known crypto investor, noted:
“[The Ethereum Foundation is] a gigantic concentration of power, politics and money and such things are always corrupted.”
And instead of discussing electing a “new ruler” of EF, there should be no ruler or EF. We should be “striving to make the organization redundant,” he said.
Click here to learn all about investing in Ethereum.
Altcoins Take a Brutal Hit, Litecoin Eyes the ETF
When it comes to Litecoin (LTC), the $8.8 billion market cap cryptocurrency, it has been trading at $118.17, down 3.9% in the past 24 hours and a whopping 71.5% from its May 2021 high of $410.26.
The silver to Bitcoin’s digital gold, LTC, has been slowly disappearing into irrelevance, having recorded gains of a mere 41.64% in 2024 and 2.77% in 2023, only to get back into the limelight as ETF rumors began circulating.
With Trump, new leadership is coming to the Securities and Exchange Commission (SEC), which has the market expecting additional cryptos to join Bitcoin and Ether by getting their own ETFs. Litecoin is expected to be the first one among them, according to experts.
“Canary Funds just filed an amended S-1 for their litecoin ETF filing. No guarantees — but this might be indicative of SEC engagement on the filing.”
– Bloomberg Intelligence’s ETF analyst James Seyffart stated on X
With the 19b-4 form for the ETF filed by the Nasdaq stock exchange, the SEC is now required to approve or reject the LTC ETF application this year.
“We had heard chatter that the litecoin S-1 had gotten comments back from the SEC,” wrote Eric Balchunas, who’s also an ETF analyst at Bloomberg Intelligence, according to whom the amended filing “bodes well for our prediction that litecoin is most likely to be the next coin approved.”
This is not the only ‘dino’ coin, which refers to old cryptocurrencies, to gain attention, though, as others such as LINK and HBAR have also been getting traction. Among these old coins, XRP has been seeing the most interest. The 3rd largest crypto asset with a market cap of $177.8 bln, XRP price recently hit a new ATH at $3.40 for the first time in seven years.
As of writing, XRP is trading at 3.09, up 48.27% YTD, which comes after 238.2% returns last year. Last week, the media also reported that Trump has been “receptive” to the idea of creating an “America-first strategic reserve” of tokens like SOL, XRP, and USDC.
Besides LTC, XRP is also among those that can get its own ETF. Last month, Balchunas wrote that “a wave of cryptocurrency ETFs” is expected this year, which is likely to start with a combo of Bitcoin and Ether followed by Litecoin and then the likes of HBAR, XRP, and Solana.
It all, however, comes down to the approach taken by Paul S. Atkins, who has been nominated by Trump to serve as Chair of the SEC.
Click here to learn all about investing in Litecoin (LTC).
SEC Launches Crypto 2.0 Task Force
Another interesting development came in the form of a new SEC initiative to clear confusion around crypto regulations, as announced by Acting SEC Chairman Mark T. Uyeda. It also aims to create a clear and straightforward regulatory framework for crypto assets.
The “Crypto 2.0 Task Force,” as it’s called, will be led by Commissioner Hester Peirce. Richard Gabbert, a senior advisor to Uyeda, will handle things as Chief of Staff, with Taylor Asher stepping in as Chief Policy Advisor.
To achieve its goals, the newly set crypto task force will set clear rules for crypto companies, offer practical ways for them to register, and ensure enforcement resources are used where they’re really needed. The team also plans to work with Congress, other federal agencies like the Commodity Futures Trading Commission, and even international groups to get everyone on the same page.
For now, as Bitcoin price dropped following Trump’s inauguration, altcoins fell even harder, and their total crypto market cap is now down 3% to $3.6 trillion. Just before the weekend, this market capitalization was at $3.45 trillion, and in mid-Dec., it was just above $3.9 trillion but not far from the 2021 peak of $3.069 trillion.
Well, for now, as Bitcoin price dropped following Trump’s inauguration, altcoins fell even harder, and their total crypto market cap is now down 3% to $3.6 trillion. Just before the weekend, this market capitalization was at $3.45 trillion, and in mid-Dec., it was just above $3.9 trillion but not far from the 2021 peak of $3.069 trillion.
What About Meme Coins Though?
Meme coins had an even rougher day than altcoins as Trump launched his very own set of meme coins just days before he took office.
When TRUMP was launched early Saturday, people dumped their tokens and piled them into the president’s meme coin. But then MELANIA was launched, triggering a 58% drop in TRUMP’s value.
These new meme coins, which have no inherent utility and are purely driven by speculation, made some investors overnight millionaires, which ignited a frenzy. But not for long. Even the lack of mention of crypto from the President hit his own token brutally, as it went down 24.5% in the past 24 hours and more than 45% from its ATH of $73.43 made just two days ago.
Trump debuting a meme coin, however, has crypto attention among the masses rising significantly, as per Google Trends, which is used to gauge retail interest in trending topics. The partial data for the search query ‘how to buy crypto’ currently has a value of 86, which is close to reaching the height of popularity.
Despite this attention, the broader memecoin market is down, with some of the top meme coins losing as much as 15% to 24% in value in the last 24 hours. This wipeout might be temporary, but the industry is now divided between what Trump launching its own meme coin means for the market. Some believe it is bad for the market in the long term, while others view it as a new paradigm. According to Bernstein analysts led by Gautam Chhugani:
“It signifies a new regulatory era, where governments see crypto as a technology to reach out to the masses directly.”
Click here to learn all about investing in Official Trump Token (TRUMP).
What’s Ahead for the Crypto Market?
The market may be red, but this is just the beginning with Trump now in office for four years, and we may see him fulfilling some if not all of his promises to the crypto market.
The biggest promise made by Trump is establishing a national Bitcoin reserve, making the US the global hub for cryptocurrency, pro-crypto regulatory guidance, commuting the life sentence of Ross Ulbricht, “defend the right to self-custody,” and no digital dollar (CBDC).
The first day of Trump’s second presidency wasn’t good for crypto, though; now it’s time to see if Trump will use his executive powers to promote crypto adoption and drive the prices upwards.
Both 2023 and 2024 were bullish years for Bitcoin, recording a positive price performance of 154.5% and 21.11%, respectively. The market is expecting BTC to pull in another strong year on the back of Trump’s pro-crypto presidency, but it’s too early to say what the future holds.
For now, the digital asset market seems to have lost momentum. The critical question is if it is indeed the top or if there’s more fuel left to drive prices higher!
