Crypto industry participants wanted to see regulatory clarity and a strategic bitcoin reserve. Instead, they saw Trump's meme coin.
It's still early days, but the kickoff of President Donald Trump's second term appears to have left some crypto investors disappointed so far.
Trump, whose candidacy was endorsed by key crypto players and who had made several promises related to the industry, signed a barrage of executive orders in his first day back in office Monday. None related to crypto and the president hasn't mention digital assets since his return to the Oval Office as of Tuesday afternoon.
Meanwhile, Trump and the first lady launched their namesake meme coins over the weekend, before the president's inauguration. That further upset some crypto industry participants. Meme coins, typically based on internet memes, tend to have no economic use.
"I think crypto industry participants' expectations were too high, and what Trump did so far kind of fell short of expectations," said Alexander Blume, chief executive of crypto investor adviser Two Prime.
"There were very high expectations for things to happen immediately, such as the potential creation of a bitcoin strategic reserve, clear policy changes through executive orders or freeing Ross Ulbricht on Trump's first day of office. And none of that stuff has happened quite yet," Blume said.
Trump vowed to build a strategic bitcoin reserve in the U.S. during his campaign, while he has not mentioned any specific plans. He also said he would commute the life sentence of Ulbricht, creator and operator of darknet marketplace SilkRoad, on "Day 1."
While it did not happen on his first day in office, Trump said late Tuesday he had pardoned Ulbricht.
Bitcoin (BTCUSD) hit a record high at $109,225 early Monday, ahead of Trump's inauguration ceremony, but drifted lower over the course of the day to trade just north of $100,000 before recovering. The crypto is up 13.8% so far this month, trading around $106,296 on Tuesday afternoon.
It may also be a positive sign for the industry that the U.S. Securities and Exchange Commission said Tuesday that its acting chairman Mark Uyeda launched a crypto task force dedicated to developing a "comprehensive and clear" regulatory framework for digital assets. SEC Commissioner Hester Pierce, who is viewed as friendly to crypto, will lead the task force, the agency said.
Still, Trump's launch of his namesake meme coin has drawn some backlash from the crypto community. The $TRUMP coin's market capitalization soared to $8.7 billion on Tuesday, according to data from CoinMarketCap. Its price rose over 1,100% to as high as $75.35 on Sunday from $6.20 at launch, before pulling back to around $44.29 on Tuesday afternoon.
The $MELANIA meme coin's market cap rose to around $653 million on Tuesday, while its price has fallen to around $4.40 from around $8.10 at launch and from its peak at $13.05 on Monday.
One area of concern is that 80% of the $TRUMP token's supply is owned by Fight Fight Fight and CIC Digital, an affiliate of the Trump Organization, though they are subject to a three-year unlocking schedule, according to the token's website.
"It is clear to see where and why President Trump's 180-degree on crypto occurred," Mike O'Rourke, chief market strategist at equity trading firm Jones Trading, wrote in a Monday note.
"One thing that did not emerge from this weekend and the inauguration is how or why bitcoin investors will be better off from all this," O'Rourke said.
Representatives from the Trump Organization and the White House did not immediately respond to requests seeking comment for this story.
Ryan Selkis, former chief executive at crypto research firm Messari and an outspoken supporter of Trump, said on X that the president should fire the person who recommended the Melania token launch.
"1. They don't know what they're doing. 2. They cost you a lot of $ and goodwill. 3. They don't have your interests in mind," he wrote on X on Sunday.
Two Prime's Blume said that while Trump's meme-coin launch further shows his embrace for the digital-asset industry, "for people that are hoping to make crypto more serious and reform the global financial infrastructure, it kind of works counter to that," Blume said.
"It's not a bitcoin approach, it's more of this crypto casino approach where you just create a meme coins and launch it," Blume said.
This report was updated to reflect the pardon of Ross Ulbricht.
-Frances Yue
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