At the end of 2024, the crypto market experienced an unprecedented rapid bull market. The price of Bitcoin surged to over $100,000 after Trump's victory in the US election, thus kicking off Bitcoin's journey to $100,000. This wave of market sentiment not only drove the rise of Bitcoin, but also boosted the prosperity of the entire crypto market. Data shows that the total market capitalization of the global crypto market increased by about $1.8 trillion in 2024, with $1 trillion of that increase occurring after the election. However, this market frenzy became even more frantic after Trump's formal inauguration in January 2025, as Trump's team launched a series of aggressive moves, including the launch of their own MEME coin TRUMP, whose market value surpassed $160 billion in just two days. The celebrity effect in the crypto world has shifted from Musk to Trump, as this industry is far more sensitive to information than other sectors. The NX.one Research Institute will conduct an in-depth analysis of the Trump effect and the investment opportunities in the Trump 2.0 era.
Reviewing how Trump's election victory ignited Bitcoin
Let's first review the first Trump effect. Since Trump's victory in the US election on November 5, Bitcoin's performance can be divided into three major breakthroughs:
The first stage was the rapid rise of Bitcoin's price since November 5. On November 10, Bitcoin broke through the $80,000 mark, and just three days later, on November 13, it surpassed $90,000, with the market performing extremely strongly.
The second stage was on November 20, when news broke that Trump's team was considering creating a dedicated position for crypto currency policy in the White House, which would be the first time such a position has been established in White House history, reflecting the growing influence of the crypto industry on the new government. The next day, Bitcoin's price further climbed, breaking through $98,000.
The third stage was on December 5, when Trump formally nominated Atkins, an official with a friendly attitude towards cryptocurrencies, as the new chairman of the US Securities and Exchange Commission. According to insiders, Atkins will work to reduce regulatory restrictions on cryptocurrencies and mitigate the severity of related violations after taking office. This personnel appointment news caused Bitcoin's price to soar again, successfully breaking through the $100,000 mark.
The NX.one Research Institute believes that Trump's victory not only ignited Bitcoin, but also ushered in a new round of bull market for the entire cryptocurrency. The total market capitalization of the crypto market grew by 39.9% in that month, from $2.48 trillion at the beginning of the month to $3.47 trillion. Ethereum also performed well, rising 47.8% in the month from $2,511 to $3,711. In addition, the Altcoin market also saw a recovery, with XRP leading the market with a 362.3% increase, and MEME coins like DOGE and SHIB rising 160.4% and 70.7% respectively.
While the market was making steady and rapid progress, the Federal Reserve cut interest rates to 4.5%-4.75% on November 7, further driving the rise of risk assets. At the same time, the resignation of SEC Chairman Gary Gensler sparked market optimism about an improvement in the regulatory environment. But undisputedly, the core driving force behind this bull market was the Trump effect.
Trump formally takes office, with his family fully involved in the crypto industry
In January 2025, before Trump's formal inauguration, he and his family members made high-profile forays into the crypto industry, triggering violent market fluctuations. First, Trump and his wife Melania both issued their own MEME coins.
Trump issues the TRUMP token:
On January 18, Trump announced on social media the launch of his personal MEME token TRUMP (OFFICIAL TRUMP), which is the first cryptocurrency ever issued by a US president. The TRUMP token was issued at $0.1824, and its price surged over 15,000% in the first 12 hours, reaching as high as $82, with a market capitalization exceeding $82 billion.
The decision to issue the token on the Solana blockchain was a critical one. The NX.one Research Institute had predicted in 2024 that a battle between the Ethereum and Solana chains would inevitably occur this year, and the launch of TRUMP triggered a frenzy of market enthusiasm, with a large influx of investors flocking to the Solana chain for trading. Data shows that the trading volume on the Solana chain increased by 1200% in a short period of time after the launch of the TRUMP token, benefiting several decentralized exchange platforms (such as Jupiter, Raydium and Meteora). Solana's native token SOL price hit a record high of over $290 on January 19, and Solana's market cap also surpassed $159.2 billion.
In addition to strongly empowering the Solana chain, it also stimulated and encouraged the MEME coin sector. The successful launch of the TRUMP token ignited broader market interest in MEME coins, and other MEME coins also surged. Subsequently, Trump's wife Melania announced the launch of MELANIA on January 19, whose market value quickly exceeded $10 billion. Trump's youngest son's namesake MEME coin BARRON also went online, and its market value has soared to around $400 million in less than 24 hours, on par with TRUMP and MELANIA.
Trump's two sons, Eric Trump and Donald Trump Jr., have also been actively involved in the crypto space. Eric Trump voiced his support for the TRUMP token on the X platform, calling it "a family initiative to enter new emerging business areas". In addition, the Trump family is deeply involved in the World Liberty Financial Initiative (WLFI) project, with Donald Trump Jr. not only being a promoter of WLFI, but also reportedly one of the project's helmsmen, participating in its strategic decision-making.
It is clear that the Trump family has fully engaged in the crypto industry, and the ties between the two are deepening. However, the celebrity effect in the crypto world also comes in waves, and the market's reaction may not be 100% in the oligarchs' expectations. For example, the launch of TRUMP token triggered a market frenzy and a flood of capital into the crypto market, but the subsequent launch of MELANIA triggered a "vampire effect", causing the TRUMP token price to plummet by 60%, demonstrating the market's high sensitivity to the Trump family's dynamics.
Crypto market volatility after Trump's inauguration:
Although Trump expressed support for cryptocurrencies during the campaign, he did not mention anything related to cryptocurrencies in his inauguration speech on January 20. This unexpected move caused violent fluctuations in the crypto market:
On January 20, as the market capital flowed in, anticipating the release of positive information in the inauguration speech, the crypto currency market embarked on a roller coaster ride. Bitcoin's price soared from $99,600 to $109,200, and then experienced a sharp plunge. Early on the 21st, Bitcoin touched a low of $100,200. As of the time of writing on the afternoon of the 21st, Bitcoin was fluctuating around $102,000, down 5.6% in 24 hours.
The volatility of MEME coins was even more extreme, with TRUMP coin plunging over 46% in 24 hours, with its market cap shrinking to $6.7 billion. MELANIA coin, on the other hand, plummeted 64% in 24 hours, with its market cap shrinking to $583 million. According to Coinglass data, the number of crypto liquidations exceeded 250,000 in the past 24 hours, with a total liquidation value of over $750 million.
The NX.one Research Institute believes that this phenomenon shows that the market is extremely sensitive to Trump's words and actions, and his policy expectations have a huge impact on the crypto market. The Trump effect cannot only bring endless gains, but once market expectations are not met, the prices of tokens, especially MEME coins, will collapse like a mirage, posing great risks.
Grasping the Investment Trend in the Trump 2.0 Era
Although Trump did not mention Altcoins in his inauguration speech and executive orders, the recent actions of the DeFi project World Liberty Financial (WLFI) supported by his family indicate Trump's emphasis on the Altcoin field. The following is a detailed analysis of WLFI's recent actions:
Increased Holdings on Inauguration Day
On January 20, the day of Trump's inauguration, WLFI announced that it had increased its holdings by $32.81 million in WBTC, $37.47 million in ETH, $4.7 million in TRX, and other Altcoins, with a total increase of over $88 million. This move not only demonstrates WLFI's long-term optimism about Altcoin assets, but also indicates its active layout in the global Altcoin financial market.
First Investment in a Chinese Project
In this round of increased holdings, WLFI invested $4.7 million in TRX for the first time. TRON, founded by Justin Sun, is one of the leading projects in the blockchain field. This investment not only marks the extension of WLFI's strategic layout to the Chinese blockchain community, but also opens up in-depth cooperation between the two parties in the Altcoin ecosystem.
Cooperation with Ethena Labs
On December 18, WLFI announced a partnership with Ethena Labs, planning to implement sUSDe in DeFi cooperation. This cooperation will leverage Aave's lending infrastructure to further increase WLFI's total value locked and attract more users.
Other Holdings and Market Impact
From the WLFI's main holding token overview chart made by ODAILY, it can be seen that ETH accounts for the highest proportion of WLFI's holdings, reaching 61%. In addition, WLFI also holds tokens such as WBTC, AAVE, LINK, and ENA. These holdings are seen as potential positives, bringing the "American attribute" label to the related tokens.
Conclusion
The Trump effect has brought new development opportunities to the Altcoin industry, but also triggered high market sensitivity and potential risks. NX.one Research Institute believes that although Trump did not mention Altcoins in his inauguration speech, the market still has full confidence in his policy expectations. David Bailey, CEO of Bitcoin Magazine, said that Altcoin-related executive orders may be included in the first 200 executive orders after Trump's inauguration. In addition, WLFI, supported by the Trump family, has recently shown its clear support for the Altcoin field through frequent increased holdings and various collaborations. These signs indicate that Altcoins may still occupy an important position in Trump's future policy planning. Investors need to closely monitor subsequent policy dynamics and WLFI's further actions to grasp the development trend of the Altcoin market.
