Pakinomist — and other cryptocurrencies, including a recently launched Donald Trump meme coin, pulled back on Tuesday after the president’s first policy announcements failed to mention the asset class.
Bitcoin, the largest cryptocurrency by market capitalization, hit a record high of $109,071 on Monday as Trump was sworn in as the 47th US president. Those gains quickly reversed, however, with the cryptocurrency trading at $102,100.0 by 04:27 ET (09:27 GMT) on Tuesday.
The Trump-themed meme coin, , launched a few days earlier on Friday, also saw a sharp drop. Priced at $6.5 at launch, it rose to a high of $74.59 on Monday, giving it a valuation of over $14 billion. At the time of writing on Tuesday, the coin was trading at $40.20, according to CoinGecko.
In his inaugural address, Trump outlined various executive actions on trade tariffs, immigration, energy deregulation and even issued a reprieve for TikTok. Still, cryptocurrencies went unmentioned, disappointing industry stakeholders who had hoped for significant policy shifts under the crypto-friendly president.
“I think in the short term there’s a chance this could be a sell-news event,” said Matthew Dibb, chief investment officer at Astronaut Capital. He noted that many investors had expected immediate executive action on digital assets.
“The market has some high expectations for a strategic bitcoin reserve and an easing of regulations around digital assets, but it is more likely that these developments will be trickled down over a number of months rather than days. Bitcoin has already retreated… We are expecting further volatility here and probably a sell-off,” Dibb added.
The crypto exchange-traded funds (ETFs) also felt the pressure, with the ChinaAMC Bitcoin ETF (HK: ) falling more than 5%.
Despite the lack of immediate action on cryptocurrencies, Trump’s early staff moves offered some hope for the industry.
Mark Uyeda, a Republican member of the SEC, was named acting chairman of the agency, with Trump planning to nominate former SEC Commissioner Paul Atkins to the permanent role.
Atkins is expected to roll back the crypto crackdown that began under Gary Gensler, Biden’s Democratic SEC chairman. Uyeda has also criticized the agency for not providing clear guidelines to crypto firms.
Republican SEC officials are reportedly preparing to overhaul the agency’s cryptocurrency policies, with changes potentially coming as soon as next week, Reuters said in a report citing sources familiar with the matter.
Meanwhile, Trump’s launch of the $TRUMP token and First Lady Melania Trump’s token before his inauguration have raised conflict-of-interest concerns, Reuters said, citing ethics experts.
Eighty percent of $TRUMP tokens are owned by CIC Digital, a subsidiary of Trump’s business, and another entity called Fight, Fight, Fight. The companies claim that the tokens are not investments, but an “expression of support for, and commitment to, the ideals and beliefs embodied by the symbol ‘$TRUMP’.”
Separately, World Liberty Financial, another Trump-linked crypto project, raised $300 million through an initial token sale.
Trump has promised to transfer the management of his assets to his children, but the crypto-asset is under heavy scrutiny for its potential to quickly generate billions in speculative investments with minimal transparency.
