Why is Bitcoin rising? Welcome to the Trump Era of Crypto

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On Monday morning, research firm Bernstein came out with some crypto advice for its Wall Street clients: “Buy everything you can.” Ever since the invention of bitcoin 15 years ago, this would be the kind of bloodshot, crazy eyes you could ignore because it came from a fanatic. But Bernstein is not a crypto-pilled boiler room operation. Rather, it is part of the stable French investment bank Societe Generale traces its history back to the 1960s, when the US was still on the gold standard. The paper immediately moved around the financial industry. When I started writing this column, bitcoin was testing new highs above $82,000 eclipsed $88,000 Looking at the sheer volume of trading, it was likely crypto’s biggest day ever.

Welcome to the Donald Trump era of crypto. It’s barely been a week since Trump won the election, but it’s looking increasingly likely that the next four years in cryptoland will make the time when Sam Bankman-Fried was the industry’s fuzzy-headed mascot look tame in comparison. What happened? It’s not like there was a mass conversion event among Wall Street’s most cynical money men to the utopian promises of the digital future. There has been no new invention, no new use discovered that would make bitcoin or any other digital currency more likely to be a part of your everyday life. The math here is that all the insanity of the pandemic-era boom could come back in force — and this time, like Trump, the industry is emboldened to be even bigger, richer and more brazen than it’s ever been before.

There is no guarantee that bitcoin or any other digital token will be worth more tomorrow than it is right now. Volatility and soaring risk are a central part of investing in crypto, and that didn’t change on November 6th. But crypto in 2025 looks to be the industry’s best chance to make itself something bigger than just a financial sideshow — in the next four years, the industry is absolutely looking to make itself institutional. The coming Trump economy, if anything like the last, will be very good for business, with lower taxes and interest rates, freeing up more money for people to speculate. And the industry has already made it as easy to buy crypto as anything else available on the New York Stock Exchange. Which, broadly speaking, has meant that more money has entered the space, which has led to rising prices and dampened volatility. Ever since this winter, when regulators allowed 401(k) money to flow into bitcoin ETFs, giants like BlackRock have acted as a bridge between the traditional and digital worlds of finance — which, in turn, has only served to make crypto so much bigger.

The biggest takeaway from the Biden administration, however, will likely be how much the industry will police itself. It is at least partly a function of an extremely aggressive lobbying campaign. Brian Armstrong, CEO of Coinbase — the largest US crypto exchange — bet he could raise more than $100 million from his industry to elect a crypto-friendly government — and he ended up with a historic streak that rivals some of the very big Wall Street trades. Bloomberg votes that out of the 48 races where cryptocurrencies supported a candidate, the industry has won every single one. (There are eight left, and all but three appear to be breaking against the industry). Washington, DC’s most powerful anti-industry bulwarks, including Democratic Ohio Senator Sherrod Brown and Securities and Exchange Commission Chairman Gary Gensler, are losing their jobs. The winners, like Brown’s successor Bernie Moreno, are openly pushing for crypto to get laissez-faire treatment. One senator, Cynthia Lummis of Wyoming, has introduced a bill that would require the Treasury Department to buy and hold a “strategic reserve” of 1 million bitcoins for 20 years — putting the United States more in line with El Salvador, which has tried and mostly failedto integrate the activity into everyday life.

It’s not just lawmakers. Howard Lutnick, who oversees Trump’s staffing, is the CEO of investment bank Cantor Fitzgerald — which happens to be where Tether, the crypto industry’s lifeblood, stablecoin, keeps his money. Elon Musk, who at least had money 119 million dollars of Trump’s get-out-the-vote operations, is a big crypto advocate – especially joke dogecoin – and Tesla owns big stores of bitcoin. (His promise to oversee a Ministry of State Efficiency eradicating government spending is, sorry to say, a crypto joke).

Of course, the first Trump administration oversaw a wild crypto bull market in 2017, prosecuting plenty of fraud and fraud at the time. What the crypto industry complains about the most these days is that the federal government doesn’t make crypto-specific regulations and that it uses the courts to set policy. Do not forget that this practice arose under Trump when he wrote he was “not a fan of Bitcoin and other cryptocurrencies which are not money and whose value is very volatile and based on thin air.” But since July, when Trump vowed at the annual bitcoin conference to cut off Gensler and make the US the global center of crypto, his late-in-life conversion was accepted by the industry without much of a second thought.

This is essentially what Bernstein and many others on Wall Street are excited about: putting money into a relatively new asset class now that regulators and federal prosecutors seem poised to let it grow. Coinbase and MicroStrategy, a technology company that has $10 billion in bitcoin, went vertically on Monday. The total market for all crypto was within a breath of reaching $3 trillion – about the size of the economy of France. In fact, the only digital asset to lose money among the largest 100 was Monero – a cryptocurrency favored by people like North Korea because it is so useful for laundering large sums of money. (The first Trump administration had prosecuted a multi-decade low for white-collar crimeafter all, so it’s not clear that money laundering would be much of a priority.)

Last year Bloomberg journalist Zeke Faux (who is a friend of mine) published a book called Number Go up about the various frauds and scams that crypto facilitates. The book’s title comes from a quote by Dan Held, an executive at a crypto exchange, who – seriously, apparently – quoted a sarcastic meme about crypto. “Number go up technology is a very powerful piece of technology,” he said, according to the book. “It’s the price. As the price goes higher, more people are aware of it and buy it in anticipation of the price continuing to rise.” Of course, what he describes paved the way for many of the Ponzi-like schemes that have defined the crypto industry thus far, not least the collapse of SBF’s crypto empire. (Not for nothing, FTX, his exchange, was based in the Bahamas, which has notoriously hands-off and crypto-friendly laws. They have since withdrawn.) Crypto’s doubters have continued to make the same case against it over and over again: that digital assets provide a slow and expensive form of money, and that their best use is either in speculation or crime.

Perhaps in the long run all this speculation will mean another FTX-like crash – this one even bigger than the last one. But for now, the crypto bros will go absolutely ape.