Crypto Daybook Americas: Bitcoin Buzzes With Anticipation Before Trump's Inauguration

Crypto Daybook Americas: Bitcoin Buzzes With Anticipation Before Trump's Inauguration

Trump's Incoming Administration Signals Major Shift in U.S. Crypto Policy

January 17 (Reuters) - As President-elect Donald Trump prepares to take office on Monday, the crypto industry is poised for a potential policy transformation, fueled by key nominations and advisory appointments. Advocates and holders of digital assets are set to play an influential role in shaping U.S. policy on cryptocurrency and blockchain technology under the new administration.

For years, the crypto sector has battled legal challenges and regulatory enforcement from the U.S. government. However, with Trump’s incoming administration, industry leaders are hopeful for a shift toward a more favorable regulatory environment.

The transition team has announced that political appointees will be vetted for conflicts of interest, with some nominees committing to divesting their crypto holdings. In a display of optimism, the industry is hosting a sold-out black-tie gala in Washington on Friday, with tickets priced between $2,500 and $10,000. Notably, Trump’s newly appointed artificial intelligence and crypto czar, David Sacks, is expected to attend.

Crypto Market Surges as Trump’s Inauguration Nears

The crypto world is buzzing with excitement as President-elect Donald Trump's inauguration approaches. Bitcoin is maintaining its position above $100,000, while major altcoins such as Solana (SOL), Cardano (ADA), Chainlink (LINK), XRP, and Litecoin (LTC) are also experiencing notable gains. The optimism surrounding the potential formation of a strategic Bitcoin reserve is now expanding into broader crypto policy initiatives, with reports suggesting that Trump may formally announce cryptocurrency as a key policy priority.

Ethereum and Near Protocol Gain Momentum

Interest in Ethereum (ETH) is intensifying as well. Blockchain analytics firm Arkham Intelligence has reported that a wallet address linked to Trump’s World Liberty Finance (WLF) recently purchased nearly $10 million worth of ETH, fueling speculation about the administration’s blockchain strategy. Meanwhile, Near Protocol (NEAR), a prominent layer-1 blockchain, is showing strong bullish indicators. Data from Flipside suggests that the ratio of staked to unstaked NEAR is increasing, signaling growing investor confidence in the project.

Market Sentiment and Macroeconomic Factors

Overall, the outlook for the crypto market remains bullish, particularly following the latest U.S. Consumer Price Index (CPI) report, which eased inflation concerns. This has allowed traders to shift their focus toward Trump's upcoming inauguration. On-chain analysis from 21Shares suggests that Bitcoin still has significant upside potential, although some volatility remains likely.

"The macroeconomic backdrop remains supportive, with unemployment trending downward, inflation showing signs of easing, and the market riding a wave of enthusiasm tied to Trump’s inauguration," said Valentin Fournier, an analyst at BRN. "We maintain a bullish outlook for Q1, though a correction could happen this week if the new administration doesn't outline a solid action plan."

Potential Risks and Market Dynamics

Despite the prevailing bullish sentiment, traders should consider the possibility of a price dip if a major policy announcement fails to materialize on Trump’s first day in office. Additionally, Bitcoin is currently trading at a discount on Coinbase relative to Binance, suggesting weaker demand from U.S. investors. Data from Arkham Intelligence also indicates that a large-scale investor, or "whale," transferred over $1 billion worth of BTC to Coinbase on Thursday. Typically, such large exchange deposits signal an intent to sell, which could introduce short-term selling pressure.

With the market at a pivotal moment, investors are closely watching how the Trump administration will shape the future of cryptocurrency regulation and adoption in the United States. The next few weeks will be crucial in determining whether the bullish momentum continues or if a correction is on the horizon.