Crypto ebbs and flows, but this drop wasn’t what was promised under Trump.
When Donald Trump secured his second presidential term in 2024, many crypto enthusiasts anticipated a golden era for digital currencies. Trump’s vocal support for crypto during his campaign, coupled with promises of deregulation, sparked optimism across the market. In fact, Bitcoin surged past the six-figure mark for the first time in history shortly after his victory.
Yet, since Trump’s inauguration, Bitcoin has tumbled nearly 20% in value. For an asset known for its volatility, price swings are nothing new. But this particular downturn seems to have deeper roots — many of which trace back to Trump himself. Let’s break down the four main factors behind Bitcoin’s sudden nosedive.
1. The $TRUMP Memecoin Meltdown
Trump’s surprise launch of the $TRUMP memecoin just days before taking office made headlines for its explosive rise — and catastrophic fall. Initially, $TRUMP skyrocketed from being nearly worthless to trading around $75, making it the most successful memecoin launch ever. Trump’s inner circle reportedly pocketed $100 million in trading fees, all without offloading their own holdings.
However, for everyday investors, $TRUMP turned out to be a disaster. According to The New York Times, over 810,000 crypto wallets collectively lost around $2 billion.
The fallout didn’t stop with $TRUMP. Other Trump-affiliated tokens, like $MELANIA and the Argentinian President Javier Milei-endorsed $LIBRA, flopped spectacularly, draining billions from the market. As speculators funneled money into these coins, only to lose it all, the broader crypto market — including Bitcoin — felt the shockwaves.
2. Underwhelming Pro-Crypto Policies
Crypto lobbyists invested heavily in Trump’s campaign, hoping he’d champion the industry once in office. In return, they expected Trump to curb federal investigations into crypto companies, loosen regulatory constraints, and push for favorable legislation.
Trump has made some moves — like dropping the SEC lawsuit against Coinbase and signing an executive order promoting crypto adoption. But these gestures have largely benefited select companies rather than the industry at large.
Crypto is a fast-moving space, and vague promises of future action aren’t enough to restore investor confidence. With Trump seemingly more focused on personal profit through his meme coin ventures than meaningful policy change, investors are losing faith in the so-called “crypto president.”
3. The Largest Crypto Heist in History
Security breaches have long plagued the crypto market, but the recent $1.5 billion hack of Bybit, one of the world’s largest exchanges, marked a new low. This single theft accounted for more than half of all crypto stolen globally last year.
Although Bybit moved swiftly to compensate users with loans and large deposits, the damage was already done. In the immediate aftermath, investors pulled a staggering $5.3 billion from the platform overnight.
The incident underscored the lingering vulnerabilities in crypto infrastructure, amplifying market anxiety and driving many investors to liquidate their holdings — including Bitcoin.
4. A Volatile Economy Under Trump
Economic instability is another major factor weighing on crypto prices. Trump’s erratic policymaking, mass layoffs of federal workers alongside Elon Musk, rising consumer prices, and threats of unpredictable tariffs have created a turbulent financial landscape.
While crypto advocates often claim digital currencies are immune to traditional market forces, reality tells a different story. When traditional markets struggle, crypto tends to follow suit. And with economic uncertainty mounting under Trump’s leadership, many investors are prioritizing financial security over speculative assets like Bitcoin.
What’s Next for Bitcoin?
Despite its recent decline, Bitcoin has weathered countless market storms and always managed to rebound stronger. The question now is whether Trump will pivot his approach to genuinely support the industry or continue treating it as a personal piggy bank.
For now, investors should brace for continued volatility. Bitcoin’s value is tied to much more than Trump’s actions alone — but there’s no denying that his influence, for better or worse, will continue to shape the crypto market in the months ahead.
If Trump eventually delivers on his pro-crypto promises, we could see another rally. But until then, the market is left navigating a complex mix of political unpredictability, security concerns, and investor skepticism.
One thing is certain: the next chapter of crypto history is being written right now — and it’s bound to be a wild ride.
