Written by Meta Era
With Donald Trump officially taking office as the President of the United States on January 20, 2025, this is a definite signal for a series of reform measures to be introduced, especially for the emerging cryptocurrency industry. After Bitcoin broke through $100,000 to create a new high, it seems that the crypto industry has fallen into a swamp. Bitcoin has been jumping up and down around the $100,000 mark. In addition, there will be an extremely long vacuum of crypto news in February, so the market outlook needs to be treated with caution.
From campaigning to being shot and then to being elected: the biggest benefits and expectations were given in advance!
Taking a look at the entire process of Trump's campaign and election, he once gave the top ten new policies for cryptocurrency at the 2024 Bitcoin Conference. Most of them were sentences like "If I am elected, I will XXXX". Let's review them together:
Making America the global cryptocurrency capital
Stopped the crypto crackdown within an hour of taking office
Preventing the U.S. government from further developing a CBDC
Building a Strategic Bitcoin Reserve
Fire SEC Chairman Gary Gensler
Stopping the U.S. from selling its Bitcoin holdings
Cryptocurrency proposed as solution to US debt problem
Propose a comprehensive encryption policy
Cryptocurrency Advisory Committee established
Silk Road founder Ross Ulbricht's sentence reduced
Among them, "making the United States the global capital of cryptocurrency" has put the crypto community in the spotlight, allowing more voters involved in cryptocurrency trading to support his candidacy for the US presidency. Trump's series of eye-catching remarks have injected optimism into the market, but with the end of the inauguration ceremony, there have been no immediate concrete actions to fulfill these promises in the short term, causing some investors to adopt a wait-and-see attitude.
But just two days ago, Trump held a press conference at Mar-a-Lago in Florida. The press conference was initially promoted as an economic development announcement, revealing Dubai developer Damac Properties' plan to invest $20 billion in building data centers in the United States. But at this press conference, Trump proposed four new topics: increasing the military spending ratio of NATO member states, making Canada the 51st state of the United States, not giving up the military occupation of the Panama Canal and Greenland, and renaming the Gulf of Mexico "American Gulf."
The "desire for territorial expansion" revealed between the lines has suddenly made the international situation tense, and the mood of confrontation between countries is spreading, which has indirectly caused the "turmoil" in the crypto market, and the crypto market has shown a downward trend. According to the news on January 7, Coinglass data showed that the 24-hour cryptocurrency market had a total contract liquidation of US$346 million, of which long orders were liquidated for US$282 million and short orders were liquidated for US$63.4724 million. The total amount of BTC liquidation was US$69.5948 million, and the total amount of ETH liquidation was US$59.6889 million.
From his "Fight!" after being shot during the campaign, to his crypto-positive speech during the Bitcoin conference, to his final election as president, Trump has brought unprecedented attention to the crypto industry, and the crypto industry has also provided Trump with more support and funding. When he officially takes office on January 20, the crypto industry is very likely to enter the stage of "real good news will be bad news".
February: No smoke without fire, the market is sideways
Let’s take another look at the Federal Reserve’s meeting schedule for 2025.
First: January 28-29, 2025, interest rate decision
Second meeting: March 18-19, 2025, interest rate decision + economic outlook
Analysts at the StarEx exchange believe that the strong data has hit market expectations that the Fed will cut interest rates as soon as possible. Previously, the market generally expected the Fed to cut interest rates twice in 2025, but this expectation was quickly lowered after the recent economic data was released. Some analysis agencies even believe that the Fed may not cut interest rates throughout this year, and even if it does, the magnitude will be very limited. Aditya Bhave, a U.S. economist at Bank of America, said in a report to clients on Wednesday that "there are increasing signs that inflation is on an upward trend," and given the timing of the change of government, the Fed may have completed its last rate cut in this cycle.
Taken together, regarding the first Federal Reserve meeting, the obvious pullback of U.S. stocks in recent days has also brought greater uncertainty to the market. This month's interest rate meeting is very likely to maintain no interest rate cut, and there will be no more positive news for the market in the short term.
In addition, looking at the major Web3 calendars, the encryption industry in February was as calm as water, with no more big moves happening, and there will be a vacuum period for encryption news. The cryptocurrency market in February is likely to show a trend of sideways consolidation, low trading volume, and weakening volatility. Cryptocurrency prices fluctuate within a relatively narrow range, with neither a clear upward nor a significant downward trend. Moreover, trading activities have decreased, the overall market activity has decreased, and the price fluctuations have become smaller.
Elon Musk: X will not use cryptocurrency for payments in the near future
Musk recently talked about X Payments during the X Stream test and said: "There are no plans to use cryptocurrency in the X Payments service in the near future. We need a license. Now we are only focusing on legal currency and focusing on launching the X Payments service effectively."
This statement does not prove that Musk does not support cryptocurrency. Perhaps it is because of the compliance considerations of platform payment. Legal currency payment is more in line with the current development needs and compliance requirements. However, this has also made many crypto enthusiasts feel like they were hit by a blow and caused panic.
In addition, BitMEX co-founder Arthur Hayes said in his latest blog post (Sasa): In the first quarter of 2025, the market is concerned about whether the liquidity of the US dollar can offset the slow implementation of Trump's policies. If liquidity is sufficient, increasing risk exposure will be a safe choice. This also reflects that the market direction in the first quarter is unpredictable and it is almost impossible to capture certain positives. Cautious waiting is not a better choice.
Summarize
Although Trump painted a hopeful picture for the crypto industry during his campaign and promised to make the United States the global capital of cryptocurrencies, his actual actions after taking office are still unclear. As the crypto news entered a vacuum in February, market participants need to be alert to potential policy uncertainties and the impact of changes in the international situation on the market. After Trump officially takes office, whether the crypto utopia he depicts can set off a new crypto wave, or whether the previously promised new crypto policy can be quickly implemented, are enough to form a new round of positive factors and continue to push Bitcoin to a higher level.
