The election of Donald Trump promises a new era for digital assets characterized by greater regulatory certainty and a surge in market activity. The question now is whether this change is lasting or a temporary reaction to the political climate.
According to CCData’s latest Exchange Review report, aggregate spot and derivative volumes, the most commonly assessed metric for market participation, recorded a new annual high in 2024, far surpassing the previous record set in 2021 (75 trillion dollars compared to 64,000 billion dollars). With elections spurring market activity and speculation, November and December were both record months in terms of volumes, with $10.51 trillion and $11.31 trillion in monthly volumes, respectively. As a reminder, the average for 2024 (the biggest year on record) was around $6.4 trillion.
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Meanwhile, stablecoins reached a total market capitalization of $210.1 billion, its highest level ever, on Inauguration Day, according to DeFiLlama. This reflects a 3.3% year-to-date increase, driven by improving liquidity conditions on centralized and decentralized exchanges, supporting the influx of new volumes seen over the past few months.
“Made in USA” assets are doing particularly well. This is an exception since the election, where a permissive regulatory environment and the promise of more favorable terms for U.S.-based assets have generated significant investor interest and speculation. Coins such as XRP, SOL, XLM, and ALGO, which have a strong affiliation with the United States, have seen outsized returns. According to CCData, the basket associated with these coins has increased by over 360%, significantly outpacing the market. This marks a turnaround from the previous administration’s regulatory crackdown, which kept them under scrutiny for many years as they were ultimately considered securities by the SEC.
Whether this unprecedented growth continues will depend heavily on whether the new Trump administration implements its promises regarding a strategic Bitcoin reserve, incentives for domestic Bitcoin mining, and other issues. The broader market could also benefit as we enter the expansionary phase of bitcoin’s historic four-year cycle, which tends to see explosive growth over the past year.
It will be interesting to see if this new administration will impact the market cycles that the cryptocurrency industry has become accustomed to, or if it will mark a significant change from historical trends.
