The election of Donald Trump promises a new era for digital assets characterized by greater regulatory certainty and an increase in market activity. The question now is whether this shift is sustainable or a temporary reaction to the political climate.
According to CCData’s latest Exchange Review report, aggregate spot and derivatives volumes, the most common measure assessed for market participation, registered a new annual high in 2024, greatly surpassing the previous record set in 2021 ($75 trillion vs. $64 trillion USD). With the election driving market activity and speculation, November and December were both record months for volume, with $10.51 trillion and $11.31 trillion in monthly volume, respectively. For context, the average for 2024 (the biggest year ever) was about $6.4 trillion.
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At the same time, stablecoins reached a total market capitalization of $210.1 billion, the highest point ever, on inauguration day, according to DeFiLlama. This reflects a YTD increase of 3.3% year-to-date on the back of improved liquidity conditions across both centralized and decentralized exchanges, supporting the influx of new volumes seen in the past few months.
Assets “made in the USA” have performed particularly well. These have been an outlier since the election, where a permissive regulatory environment and the promise of more favorable conditions for US-based assets have generated significant investor interest and speculation. Coins such as XRP, SOL, XLM and ALGO, which have a strong US affinity, have seen great returns. Per CCData, the curve associated with these coins has increased by over 360%, outperforming the market by a significant margin. This marks a reversal from the previous administration’s regulatory crackdown, which kept these under control for many years when they were ultimately considered securities by the SEC.
Whether this unprecedented growth continues will largely depend on the new Trump administration’s execution of its promises of a strategic bitcoin reserve, incentives for domestic bitcoin mining, and other issues. The broader market may also benefit as we enter the expansionary phase of bitcoin’s four-year historical cycle, which tends to see explosive growth in the last year.
It will be interesting to see if this new administration will affect the market cycles that the cryptocurrency sector has become accustomed to, or if it will mark a significant departure from historical trends.
