The Trump Effect: A Surge of Funds into Bitcoin and Ether ETFs
$BTC $XRP The cryptocurrency market has reignited following Donald Trump’s election as U.S. President, fueled by campaign promises favoring crypto-friendly regulations and the removal of barriers in the digital asset industry. Significant inflows have been recorded in exchange-traded funds (ETFs) based on Bitcoin and Ether, marking unprecedented demand.
Key Drivers of ETF Growth
1. Trump’s Campaign Promises
Trump has pledged to:
- Establish a government Bitcoin reserve.
- Ensure all future Bitcoin mining is conducted within the U.S.
- Replace SEC Chair Gary Gensler, viewed as a regulatory obstacle for cryptocurrencies.
These promises sharply contrast with the policies of the previous Biden administration, which took a more cautious approach toward digital assets.
2. Record-Breaking Fund Inflows
- Bitcoin ETFs recorded a net inflow of $6.5 billion in November 2024 (~IDR 102.3 trillion).
- Ether ETFs saw net inflows of $1.1 billion (~IDR 17.49 trillion), with nine Ether ETFs achieving record demand, particularly from issuers like BlackRock Inc. and Fidelity Investments.
3. Crypto Market Rally
- Bitcoin approached the $100,000 milestone, last trading at $96,675 as of Monday, December 2, 2024.
- Ether surged to $3,675, a 9.4% week-on-week increase, although still shy of new all-time highs.
- XRP experienced a parabolic rise amid speculation that Trump would repeal SEC actions that have previously weighed on Ripple.
Impact on the Market
Since Trump’s election, the crypto market has added $1.2 trillion in value, according to CoinGecko data. This rally has overshadowed memories of the painful crashes and scandals that marked the 2021 crypto boom.