The cryptocurrency market faced a downturn recently, influenced by the events surrounding President Donald Trump’s first day in office. Despite expectations for a positive impact on the crypto industry, his inaugural speech did not address digital currencies, leading to declines in major crypto-related stocks.
Market Reactions to Trump’s Inauguration
Following Trump’s inauguration, shares of significant crypto companies experienced notable drops. Riot Platforms saw a decline of 4.85%, while Marathon Digital Holdings fell by 1.76%. Other companies also faced significant losses, including Terawulf Inc, which dropped 6.88%, and CleanSpark, which fell by 7.67%.
In contrast, the broader stock market showed a slight increase, with the S&P 500 rising by 0.88% after a market closure on Martin Luther King Jr. Day. This uptick reflects a sense of optimism regarding Trump’s pro-business stance, even as the US dollar index declined by 1.27% from a two-year high, trading slightly above 108.
Bitcoin’s Resilience Amidst Uncertainty
Despite the struggles faced by crypto stocks, Bitcoin demonstrated resilience, continuing its rebound toward its recent all-time high. The cryptocurrency traded at $105,770, marking a 3.45% increase over the past 24 hours. MicroStrategy, known for its significant Bitcoin holdings, closed down 1.87% at $389.10 after recovering from an early morning dip of 7%.
Coinbase experienced a volatile trading session, dropping over 8.5% in the opening hour before closing relatively flat at $294.19. This mixed performance of Bitcoin and crypto stocks reflects broader market sentiment, with investors closely monitoring the actions of the new administration.
Future of Cryptocurrency Regulation
Trump’s return to the White House has sparked discussions about potential shifts in US crypto policy. His inaugural address focused on priorities such as public safety, energy independence, and government reform, leaving many in the crypto community uncertain about the future of digital currency regulation. Analysts have noted that the Trump presidency could represent a turning point for the industry, with expectations of a more favorable regulatory environment.
Despite the uncertainty, overall market sentiment remains cautiously optimistic. The slight uptick in the S&P 500 indicates that investors are hopeful about a pro-business agenda under Trump. However, the lack of immediate action on crypto-related issues has left many stakeholders anxious about the future.
Monitoring Policy Changes
As the administration settles in, the crypto community will be closely watching for any signs of policy changes that could impact the market. The recent pardon of Silk Road founder Ross Ulbricht has reignited hope among crypto advocates that Trump may still fulfill his commitments to the industry. Bitcoin bull and venture capitalist Anthony Pompliano expressed optimism, suggesting that the pardon could lead to significant policy changes, including the establishment of a Strategic Bitcoin Reserve.
In summary, the first day of Trump’s presidency has brought mixed signals for the cryptocurrency market. While crypto stocks faced declines, Bitcoin continued its upward trajectory, and the market remains in a state of flux, with investors eager to see how the new administration will approach cryptocurrency regulation in the coming months.
📎 Related coverage from: cointelegraph.com
