Is Trumpism winning and crypto failing? Bitcoin, Ethereum and XRP bleed as traders react
Bitcoin, Ethereum, and XRP face carnage in response to Trump’s policies and announcements. The total market capitalization of crypto is down to $2.784 trillion on Wednesday.
Bitcoin’s correlation with the S&P 500 is 0.75 in the 30-day timeframe, signaling to traders that the top crypto is behaving like U.S. equities. Trumpism, or what U.S. President Donald Trump believes in a particular moment on a particular day about a subject that has ushered a steep correction in crypto within the first fifty days of his administration.
Why is crypto losing while Trumpism wins?
U.S. stocks are facing a slump, the S&P 500 is down nearly 8% in the past month, and is lower than it was the day before President Trump won the 2024 election. $4.5 trillion in capital has been wiped out of the market, per the index, and the correction is not limited to equities.
Crypto, typically considered one of the high volatility risk assets, has faced a steep decline as traders turn risk averse and pull capital from the category.
While U.S. stock performance is among one of the worst ever recorded within the first 50 days of a new administration, crypto market capitalization is nearly 20% above the pre-election level, even after the correction.
When Bitcoin crossed the $100,000 milestone and hit a new all-time high, Ethereum and XRP rallied alongside. The market-wide bloodbath has ushered a decline in the top three cryptos, down nearly 15%, 28% and 9% in the past month, according to TradingView data.
Trump’s pro-crypto executive orders and Strategic Crypto Reserve announcement have failed to catalyze a positive sentiment among traders. Alternative.me’s Crypto Fear & Greed Index shows traders remain fearful on Wednesday.
