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Currencies jumped on Thursday as investor appetite shifted to less risky coins ahead of the inauguration of President-elect Donald Trump.
XRP and litecoin among the biggest movers, up 13% and 22%, respectively, according to Coin Metrics. The CoinDesk Index 20a broad benchmark in the crypto market, has gained almost 5%.
At the same time, bitcoin up less than 1% near $100,000, after a two day rally about 7% this week. Ether fell nearly 3% on Thursday.
“Retail investors (are) looking for opportunities while a new pro-crypto administration is ready to be introduced,” said Alexander Blume, CEO of consulting firm Two Prime Digital Assets. to CNBC. “The Trump administration is a rising tide in crypto, and altcoins are seeing early benefits from this.” “
Trump is expected to be inaugurated on Monday.
Trading platform operators Coinbase and Robinhood each rose by about 2%. MicroStrategywhich trades as a bitcoin proxy, up less than 1%.
“The first 50 days of Trump's presidency will determine the path of bitcoin in 2025,” said Gracy Chen, CEO of crypto exchange Bitget. “The expectations of the crypto market for his inauguration and the first steps as president are extremely high, which is confirmed by the sensitivity of the crypto market prices to the statements and positions he made in the fourth quarter of 2024.”
During his campaign, Trump promised to install a crypto advisory council in his first 100 days in office and replace the chairman of the Securities and Exchange Commission Gary Gensler, who became a well-known enemy of the industry during his tenure. The CoinDesk 20 advanced 98% in the month following the November election. In that same period, bitcoin posted a 46% gain.
Another factor driving the activity in small-cap cryptocurrencies is the possibility that the government's “strategic reserve could include other 'American' cryptocurrencies, such as XRP and the Solana mark, Blume said.
“This is not unlikely, (but) it is surprising and it makes speculators buy the coins,” he said. “The best long-term value for investors will still be in bitcoin .”
Trump has also promised to establish favorable regulation to encourage “made in the USA” domestic bitcoin mining and launch a strategic national bitcoin stockpile. Investors expect instability in the main cryptocurrency this year, with bitcoin caught in the tug of war between investors' concerns about rising inflation under Trump and their optimism regarding his pro-crypto leadership.
