In a previous article, I shared my views on the impacts of Trump's election on the entire crypto ecosystem.
During the online communication on Saturday, a reader asked a similar question. At that time, I added two points from the perspective of cryptocurrency projects about how Trump's election might affect crypto projects.
This influence may lead to significant differentiation in financing and operational methods among projects of different sizes in the future.
If Trump can really fulfill his promises to the crypto ecosystem made before the election, then in terms of major policies, overall, the crypto ecosystem and the enterprises (projects) within it will face a much more relaxed environment than now. This means that the following two aspects of activities will become increasingly vigorous:
The first is that the traditional financial sector will increasingly accept crypto enterprises, and more capital will seek opportunities within the crypto ecosystem. This primarily affects large projects within the ecosystem, especially those related to infrastructure or underlying applications.
The second is that enterprises or project parties already within the crypto ecosystem will have more motivation and enthusiasm to make some bold and exploratory moves, such as issuing tokens. This primarily affects medium and small projects within the ecosystem, especially some innovative application projects.
Let's first look at the first point.
In recent years, under the leadership of large institutions (like BlackRock), the traditional financial sector in the U.S. has increasingly accepted the crypto ecosystem.
This acceptance not only means that they have undergone a 180-degree shift in their values regarding crypto assets, but also reveals the institutions' considerations for real-world interests — they do not want to miss out on the financial benefits that crypto enterprises and assets may generate during their growth.
Previously, they were also constrained by the attitude of the U.S. Securities and Exchange Commission, only able to take small steps forward and backward. Now, with a president and vice president who clearly support the crypto ecosystem, how can institutions miss such an opportunity?
Recently, an interesting phenomenon has appeared in my social circle, where someone frequently shares news about two crypto enterprises preparing for an IPO.
One is Circle (the parent company of USDC), and the other is Kraken.
At the end of the news sharing, the sharer noted a postscript: friends interested in participating in private placements, please contact me privately; shares are limited, so hurry up.
Apart from these two companies, there are also well-known market makers in the ecosystem like Wintermute, which has frequently been rumored to be preparing for an IPO. It is said that a certain large internet company in China participated in Wintermute's financing.
These large project parties have been revealing IPO news at this time, and I believe this is not a coincidence but a phenomenon that inevitably arises as the ecosystem develops to this stage.
I think there are primarily three reasons:
Firstly, the development of the crypto ecosystem has reached a point where a considerable number of large projects can no longer solve their problems using the previously niche ICO financing method; they require increasingly larger amounts of capital, which only traditional finance can provide.
Secondly, over the years, the traditional method of issuing tokens to solve investor exits has seemingly been unfriendly to private investors, with lock-up restrictions and insufficient liquidity, etc., greatly limiting their profit exits. Now, even retail investors are unwilling to play along with them, preferring to play with meme coins rather than touch capital coins. Therefore, these investors must find other ways to realize their exits.
Moreover, previously, due to various restrictions, the resistance to the IPO of native crypto enterprises was very high. Over the years, among the crypto enterprises listed in the US stock market, aside from mining companies and MicroStrategy, there has only been Coinbase as a truly native crypto enterprise. Even this lone example, Coinbase, has faced constant harassment and inquiries from the U.S. Securities and Exchange Commission after going public.
The first two reasons will lead to traditional financial markets increasingly becoming channels for solving problems for both parties, but this channel has been ruthlessly blocked by the third reason.
Now that Trump is about to take office, the barrier that has existed between the two sides is very likely to be removed.
Therefore, in the foreseeable future, more and more crypto enterprises or projects that require high funding, especially those needing significant investment in research and operations, may choose the path of going public — this not only facilitates these enterprises in raising large amounts of capital but also allows traditional financial institutions to quickly and efficiently obtain benefits from the crypto ecosystem.
In the future, the relationship between such enterprises and us retail investors will become increasingly distant. Because taking this path means that the probability of these projects issuing tokens will become smaller and smaller; even if they do issue tokens, it will likely be negligible. Although they are cloaked in the guise of crypto, they resemble traditional enterprises more closely.
On the other hand, with the loosening of the crypto environment, I believe that the chances of more and more medium and small projects, especially innovative projects, issuing tokens will also increase — issuing tokens is an efficient means for small projects to kickstart quickly.
This is the second point I mentioned above: "Enterprises or project parties already within the crypto ecosystem will have more motivation and enthusiasm to make some bold and exploratory moves, such as issuing tokens."
Recently, Polymarket, which has been in the spotlight during this election, has been rumored to be issuing tokens.
I feel that this is the project party betting on the upcoming loosening of the crypto industry. There will still be some opportunities in the future, but they will mainly be limited to some small innovations and small applications.
Because they do not require large capital or significant investment in the initial stages; what they need is popularity and participation. Airdrops and token issuance expectations are the best incentive methods.
Therefore, we retail investors can appropriately pay attention to some active, emerging small applications and look for some opportunities that belong to us among them.
However, I still advise everyone to consider their time, energy, and financial capacity when participating in these small applications. One should act within their means and not bet everything recklessly.
The era of betting everything on a single project and even specifically setting up studios to chase any project's airdrop is long gone.
