Bitcoin’s $97K Trump Trade rally

November 21, 2024

Reading time: 5 minutes

Bitcoin's $97K ‘Trump Trade’ rally closes in on $100K milestone

Key points:

  • On early Thursday, Bitcoin traded above $97,500 during Asian hours, just 3% shy of the $100,000 mark and a $2 trillion market cap.

  • The rally, termed the “Trump Trade,” is fueled by pro-crypto sentiment in the U.S., Federal Reserve rate cuts, and institutional interest in new ETF options.

News - Bitcoin (BTC) has reached a new high of $97,500, continuing its post-election rally driven by optimism around a Republican-led, pro-crypto government in the U.S. This surge places BTC less than 3% away from the landmark $100,000 figure, which would push its total market capitalization past $2 trillion.

Dubbed the "Trump Trade," this rally reflects renewed risk appetite in financial markets following rate cuts by the Federal Reserve and widespread gains across asset classes, including stocks and bonds. Bitcoin has seen a remarkable 30% increase in value over the past two weeks, bolstered by the pro-crypto policies and leadership in Washington.

Institutional momentum - BlackRock’s newly launched IBIT options, a spot Bitcoin ETF product, saw record-breaking activity on their first day, with $2 billion in trading volume and 73,000 contracts exchanged within the first hour. The options market showcased a bullish call-to-put ratio of 4.4:1, underscoring institutional confidence in Bitcoin as a mainstream financial asset.

Market participants like QCP Capital highlighted that this influx of interest may reduce Bitcoin’s volatility and solidify its position in traditional finance markets. The strong performance of IBIT options places them among the top 20 most active non-index options globally, signaling a pivotal shift in Bitcoin’s market structure.

What’s next? - Optimistic forecasts from banks and analysts suggest Bitcoin could hit $200,000 in the coming months, driven by sustained institutional adoption and favorable macroeconomic conditions. The market response to pro-crypto policies and innovative trading instruments like IBIT options continues to attract new investor segments, paving the way for diversified trading strategies and greater market maturity.

Floki’s trading volumes surge 100% after Coinbase listing confirmation

Key points:

  • Floki (FLOKI), an Ethereum-based memecoin, saw a 100.8% increase in daily trading volumes after Coinbase confirmed its listing.

  • The token jumped 15% in price, reaching a 5-month high before slightly retreating. Also, memecoin market capitalization has doubled since Donald Trump’s victory, with Floki up 600% this year.

News - Floki, the dog-themed memecoin inspired by Elon Musk’s Shiba Inu, is making waves after Coinbase announced its listing on Wednesday. The exchange confirmed that trading would begin on Thursday at 9 AM PT, provided liquidity conditions are met. This news sent Floki’s trading volume skyrocketing 100.8% in 24 hours, with total volumes across all exchanges hitting $1.34 billion.

Floki’s price surged 15%, reaching a 5-month high before retreating slightly. Its current market cap of $2.68 billion places it as the 49th largest cryptocurrency, according to CoinGecko.

Memecoin market surge - The entire memecoin sector has flourished following President-elect Donald Trump’s November 5 win. Floki’s price is up 600% year-to-date, currently less than 20% away from its all-time high of $0.00034.

Other memecoins have also seen significant gains:

  • Dogecoin’s market capitalization increased by $30 billion in a week.

  • Solana-based Bonk (BONK) gained over 80% during the same period.

Institutional investors are taking notice, with DWF Labs launching a $20 million fund dedicated to memecoin projects. Despite skepticism surrounding the speculative nature of memecoins, their cultural influence and community engagement have made them a unique force within the crypto ecosystem.

Coinbase listing details - Coinbase plans to launch Floki trading in phases, with support limited to the ERC-20 version. Regional restrictions may apply, reflecting the exchange’s compliance with local regulations. This follows recent Coinbase listings of memecoins like Pepe (PEPE) and Dogwifhat (WIF), which experienced price spikes after being listed.

What’s next for Floki? - With its listing on Coinbase, Floki is poised to gain more visibility and liquidity, potentially attracting new retail and institutional investors. However, the speculative nature of memecoins means that price swings could remain volatile, offering both opportunities and risks to investors.

SEC returns $4.6M to BitClave investors after ICO crackdown

Key points:

  • The U.S. SEC has distributed $4.6 million to eligible investors from BitClave’s 2017 ICO through the BitClave Fair Fund.

  • BitClave’s ICO raised $25.5 million in 2017 but was later found to have violated federal securities laws. The total fund, initially set at $29 million, remains partially undistributed, with $7.4 million unaccounted for.

News - The U.S. Securities and Exchange Commission (SEC) has announced the disbursement of $4.6 million to investors in the defunct crypto startup BitClave. This marks the latest development in the SEC’s efforts to return funds to investors affected by BitClave’s 2017 initial coin offering (ICO), which raised $25.5 million in just 32 seconds during the ICO boom.

The payout comes from the BitClave Fair Fund, established after the SEC sued the startup in 2020 for violating federal securities laws. BitClave, without admitting wrongdoing, settled the case by agreeing to forfeit the entirety of its ICO proceeds, along with an additional $4 million in interest and penalties.

BitClave’s legal battle and fund details - Under its settlement agreement, BitClave committed to destroying all uncirculated Consumer Activity Tokens (CAT) and requesting exchanges to delist the token. However, while the total restitution fund was initially set at $29 million, only $12 million had been paid as of early 2023.

Eligible investors had until August 2023 to submit claims, and the SEC informed claimants of their acceptance or denial by March 2024. While $4.6 million has now been distributed, the fate of the remaining $7.4 million in the BitClave Fair Fund remains unclear, with no official statement from the SEC or the fund administrator at this time.

Implications for investors - This distribution serves as a reminder of the SEC’s increasing enforcement of securities laws in the cryptocurrency sector. Investors participating in ICOs or similar fundraising mechanisms should exercise caution and verify the regulatory compliance of projects to mitigate risks.

The BitClave case underscores the importance of regulatory oversight in the crypto industry. As the SEC continues its crackdown on unregistered securities offerings, both startups and investors must remain vigilant to navigate this evolving landscape.

Bitwise registers Solana ETF in Delaware, joins race for SEC approval

Key points:

  • Bitwise has registered a statutory trust in Delaware for a proposed spot Solana ETF, incorporated on November 20.

  • The ETF aims to track Solana’s price movements, pending SEC approval via a 19b-4 filing and S-1 registration. Bitwise would compete with VanEck and Canary Capital for the first SEC-approved spot Solana ETF.

News - Bitwise, a prominent digital asset manager, has taken a significant step toward launching a spot Solana exchange-traded fund (ETF). The company registered a statutory trust in Delaware on November 20, as per the State of Delaware’s Division of Corporations. This trust is seen as a precursor to filing an S-1 registration statement with the U.S. Securities and Exchange Commission (SEC).

The proposed ETF aims to track the price of Solana, the world’s fourth-largest cryptocurrency, but it remains unclear which stock exchange would list the product. Historically, Bitwise has listed its Bitcoin and Ethereum ETFs on the New York Stock Exchange Arca. A ticker for the Solana ETF has not yet been revealed.

The competitive landscape - Bitwise will be entering a competitive market, facing established asset managers like VanEck and Canary Capital, who are also vying for SEC approval of a spot Solana ETF. VanEck’s Matthew Sigel has predicted high odds of a Solana ETF approval by the end of 2025, citing expectations of a more crypto-friendly regulatory environment under the upcoming Trump administration.

Solana’s market performance - Solana has been a standout performer during the current bull cycle, surging 2,360% to $236.91, according to CoinGecko. However, the cryptocurrency has yet to set a new all-time high this cycle, and its performance in the previous bear market lagged behind other large-cap coins.

Implications for the crypto market - The approval of a spot Solana ETF would provide retail and institutional investors with greater access to Solana’s market, potentially driving new inflows into the asset. However, industry analysts suggest these inflows may be smaller than what has been observed with Bitcoin and Ethereum ETFs, given Solana’s comparatively smaller market maturity.

Bitwise’s move to register a spot Solana ETF highlights the growing interest in expanding crypto investment products beyond Bitcoin and Ethereum. As regulatory developments unfold, the competition for approval could shape the future of Solana’s accessibility in traditional finance markets.

Interesting facts

  • The Dogecoin community once raised $55,000 worth of DOGE to sponsor a NASCAR driver, turning his car into a full Dogecoin-themed racing machine.

  • A crypto token called "Useless Ethereum Token" was created in 2017 as a parody. Its pitch was simple: it promised to do absolutely nothing, and yet it raised thousands of dollars.

  • The first non-fungible token (NFT) ever minted was called "Quantum," created in 2014 by Kevin McCoy on the Namecoin blockchain, predating the Ethereum-based NFT craze by several years.

Top 3 coins of the day

Cardano (ADA)

Key points:

  • At press time, ADA was trading at $0.78.

  • It was down by about 2.42% over the last 24 hours.

What you should know:

The daily chart showed ADA continuing its bullish momentum, despite a slight retracement from its recent highs. The price remains well above the 9-day Simple Moving Average (SMA), which is positioned at $0.70, indicating strong support and a short-term uptrend. The Relative Strength Index (RSI) stands at 78.22, firmly in the overbought zone. This suggests that ADA might be overextended and could face a pullback or consolidation in the near term unless strong buying pressure continues to drive the rally. Trading volume has been substantial during the recent price surge, reflecting strong market interest. However, the slight decline in volume during today’s retracement suggests that sellers may be stepping in or buyers are taking profits. Immediate resistance is near $0.82, while the 9-day SMA at $0.70 acts as a critical support level if a deeper correction occurs.

FLOKI (FLOKI)

Key points:

  • At press time, FLOKI was trading at $0.00025.

  • It was down by about 2.24% over the last 24 hours.

What you should know:

FLOKI was seen to be consolidating on the daily chart after a strong bullish rally that pushed the price above the upper Bollinger Band. Such breakouts typically indicate heightened volatility and can lead to either further momentum or a retracement back toward the middle band (20-day SMA), currently at $0.00019. The Directional Movement Index (DMI) indicates a strong trend, with the +DI (green) at 42.35, significantly above the -DI (red) at 6.92, and the ADX (yellow) at 26.02, confirming a strong bullish trend. However, as the ADX approaches higher levels, traders should monitor for signs of a trend slowdown or potential reversal. Volume has spiked notably during the recent rally, reflecting strong buyer participation. The slight decline in volume during today’s session suggests a cooling of buying pressure or minor profit-taking. Immediate resistance is near $0.00027, while the middle Bollinger Band at $0.00019 serves as critical support if the price pulls back further.

Tezos (XTZ)

Key points:

  • At press time, XTZ was trading at $1.02.

  • It was down by about 3.31% over the last 24 hours.

What you should know:

On the daily timeframe, XTZ experienced a correction after a sharp rally that pushed the price significantly higher in recent sessions. The Parabolic SAR dots remain below the price, indicating that the overall trend is still bullish. However, the current retracement could continue if profit-taking persists. The Chaikin Money Flow (CMF) indicator stands at -0.04, slightly below the neutral line. This suggests a mild outflow of capital, indicating that sellers are beginning to outweigh buyers in the short term. Volume spiked significantly during the rally, reflecting strong buyer interest. However, the current lower volume alongside the pullback indicates fading momentum. Immediate resistance lies at $1.10, while the previous support zone near $0.90 (close to the recent Parabolic SAR level) may serve as a key level if the price drops further.

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