Do Bitcoin Enthusiasts Have Reason to Be Excited About Trump’s Victory?
Donald Trump’s victory carries a sense of vindication—not only for him but also for cryptocurrency enthusiasts, according to The Economist.
On election night, as Trump’s win became apparent, the price of Bitcoin, the world’s most traded cryptocurrency, surged by 10%. By November 13, just before Republicans gained control of Congress, Bitcoin’s price had exceeded $93,000, marking a nearly 50% increase since mid-October, edging close to $100,000.
This rally wasn’t limited to Bitcoin. Excluding stablecoins (designed to avoid price volatility), the top 20 cryptocurrencies saw even sharper gains. Dogecoin, often promoted by Elon Musk, a Trump ally turned advisor, soared by 140% since election day. On November 12, the global cryptocurrency market hit a valuation of $3 trillion, a significant recovery from the downturn of 2022-23.
The Crypto Revival
The collapse of major crypto firms like FTX during the 2022-23 crisis, fueled by regulatory crackdowns and poor management, had left the industry battered. However, the 2023 midterm elections provided an opportunity for a turnaround. Trump embraced cryptocurrencies, endorsing initiatives like the World Liberty Financial project supported by his family and pledging at rallies to make America a “Bitcoin superpower.”
Crypto lobbyists invested over $100 million to back pro-crypto candidates during the midterms. Many investors now hope Trump’s return to the White House will soften regulatory policies. His promise to remove SEC Chairman Gary Gensler drew cheers at crypto-related events. Gensler, a critic of digital assets, has pursued lawsuits against prominent crypto firms like Kraken, Coinbase, and Ripple, and has described the industry as rife with fraud.
A Fight Over Regulation
Gensler’s assertion that many cryptocurrencies qualify as securities—subjecting them to SEC oversight—has frustrated the industry. Issuers and traders prefer cryptocurrencies to be classified as commodities, which are regulated less stringently by the Commodity Futures Trading Commission (CFTC).
Under a second Trump administration, crypto regulations might become not only looser but also more consistent. Disputes between the SEC and CFTC over jurisdiction have created uncertainty, with major cryptocurrencies like Ether oscillating between classifications.
A Question of Clarity
While regulatory clarity could attract institutional investors to cryptocurrencies, skepticism remains. Despite his campaign rhetoric, Trump’s support for crypto seems limited. In 2021, he labeled Bitcoin a “scam against the dollar.” As a result, hopes for stable, favorable regulations under a second Trump term may be unrealistic.
For now, crypto enthusiasts can celebrate recent gains, but the industry’s long-term prospects remain uncertain.
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