Cryptocurrency markets witnessed a sharp rally on Thursday as smaller altcoins stole the spotlight ahead of President-elect Donald Trump’s upcoming inauguration. Investor enthusiasm for high-risk assets fueled gains in XRP and Litecoin, which surged 13% and 22%, respectively, according to Coin Metrics. The CoinDesk 20, a widely-followed benchmark for the crypto market, climbed nearly 5% in the same period.
Bitcoin, the leading cryptocurrency, saw modest growth, edging up less than 1% to hover near $100,000 after a two-day rally earlier this week. Conversely, Ethereum, the second-largest crypto asset, fell nearly 3% on Thursday.
“Retail investors are actively hunting for opportunities, anticipating that a crypto-friendly administration could transform the market landscape,” Alexander Blume, CEO of Two Prime Digital Assets, told CNBC. “President-elect Trump is poised to ignite a surge in the sector, and altcoins are already reaping early benefits.”
Crypto Markets Respond to Trump’s Incoming Policies
Trump’s inauguration, set for Monday, has driven significant buzz in the financial and digital asset markets. His campaign promises, including forming a crypto advisory council within the first 100 days of his administration and replacing SEC Chair Gary Gensler, have sparked optimism among investors. Gensler’s tenure was often seen as contentious for the crypto industry due to regulatory crackdowns.
Gracy Chen, CEO of Bitget, emphasized the high stakes for the market. “The trajectory of bitcoin in 2025 will be heavily influenced by the first 50 days of Trump’s presidency,” she explained. “The market is keenly responsive to his decisions, statements, and appointments.”
This sentiment is reflected in data showing a robust 98% gain for the CoinDesk 20 index in the month following Trump’s November victory. Bitcoin alone surged 46% during that timeframe.
Altcoins and U.S.-Driven Initiatives Generate Momentum
XRP and Solana have also experienced heightened speculation after rumors surfaced that Trump’s administration might establish a strategic cryptocurrency reserve that includes tokens tied to U.S. innovation. Although this remains unconfirmed, the mere possibility has fueled altcoin purchases among speculators.
“This unexpected buzz has energized smaller-cap coins, but bitcoin continues to offer the most sustainable long-term value,” Blume noted.
Adding to market enthusiasm, Trump has promised pro-crypto policies, including support for “Made in the USA” bitcoin mining initiatives and creating a national bitcoin reserve. However, the sector remains poised for volatility, torn between concerns over potential inflation and optimism for a pro-crypto stance from the new administration.
Crypto Stocks and Platforms See Boost
Even beyond cryptocurrencies, the ripple effects have been felt in the equity markets. Trading platforms Coinbase and Robinhood each recorded a 2% rise, while MicroStrategy, often seen as a proxy for bitcoin investments, climbed nearly 1%.
As Trump prepares to take office, the crypto market seems poised for a seismic shift, with many pinning their hopes on his promises to fuel innovation and regulation favoring the burgeoning digital economy. With investor sentiment running high, the coming weeks could set the stage for one of the most pivotal years in cryptocurrency history.
