Buoyed by the promise of a crypto-friendly administration, bitcoin investors have been shoveling money into cryptocurrency ETFs.
Because the election, crypto bulls have invested nearly $10 billion in a dozen U.S. crypto funds managed by investment heavyweights like Fidelity and BlackRock, in response to Bloomberg. This influx of funds brings the combined assets of those funds to $113 billion.
Experts say enthusiasm around a second Trump term already helped push bitcoin to its first-ever six-figure high last week. Crypto investors’ optimism surged when Trump announced his pick of Paul Atkins, a vocal proponent of digital assets, to exchange crypto skeptic Gary Gensler as the top of the Securities and Exchange Commission. Trump also announced on his social network Truth Social that he had appointed Silicon Valley investor David Sacks to be “White House A.I. & Crypto Czar” — one other boon for the industry.
Trump took a pro-cryptocurrency stance on the campaign trail, reversing his initial skepticism of bitcoin and other digital assets while aggressively courting Silicon Valley donors. Post-election Federal Election Commission filings show that tech investors donated greater than $394 million to Trump’s campaign, the majority of which got here from Tesla CEO Elon Musk.
Musk’s involvement within the incoming Trump administration also suggests a more crypto-friendly environment. Even the “Department of Government Efficiency” initiative Musk is spearheading with fellow entrepreneur and former Republican presidential candidate Vivek Ramaswamay has a tie to crypto, with a tongue-in-cheek name that references “meme coin” dogecoin.
Trump’s bitcoin bullishness is such that he even flirted with the thought of a “strategic bitcoin reserve,” a move former Treasury Secretary Larry Summers called “crazy.”
Since its Dec. 5 peak, a number of the froth has come off: The value of bitcoin dropped as little as roughly $92,000 before mounting a recovery. Bloomberg cited a research note from David Lawant, head of research at crypto trading and brokerage firm FalconX, that said crypto investors will need a longer-run trend of fine news to maintain the value steadily above $100,000.
Some crypto investment pros remain optimistic that such a bump is coming. Federico Brokate, vice chairman and head of U.S. business at crypto investment firm 21Shares said in a research note that a “more favorable regulatory environment” and greater adoption of cryptocurrency could push bitcoin and other digital assets higher in 2025.
With a market cap of nearly $2 trillion — roughly the identical valuation as Google parent Alphabet — bitcoin is the eighth-largest asset on the earth, surpassing even traditional alternative assets like silver, in response to crypto news platform Watcher.Guru.
