Small-cap crypto rises ahead of Trump inauguration, Bitcoin trades near $100,000

Cryptocurrencies jumped on Thursday as investor appetite shifted to smaller, riskier coins ahead of President-elect Donald Trump’s inauguration.

XRP and litecoin were among the biggest movers, up 13% and 22% respectively, according to Coin Metrics. The CoinDesk 20 indexa broad benchmark of the crypto market, increased by almost 5%.

Meanwhile, bitcoin up less than 1% around $100,000 after a two-day rally about 7% this week. Ether fell by almost 3% on Thursday.

“Retail investors are looking for opportunities as the new pro-crypto administration prepares to take office,” Alexander Blum, CEO of consultancy Two Prime Digital Assets, told CNBC. “The Trump administration is a rising tide that will lift all boats in crypto, and altcoins are seeing some of the early gains from it.”

Trump’s inauguration is scheduled for Monday.

Trading platform operators Coinbase and Robinhood each grew by about 2%. Micro strategywhich trades as a bitcoin proxy, rose less than 1%.

“The first 50 days of Trump’s presidency will determine the trajectory of Bitcoin in 2025,” said Gracie Chen, CEO of crypto exchange Bitget. “Expectations in the crypto market for his inauguration and first steps as president are extremely high, as evidenced by the sensitivity of crypto market prices to the announcements and appointments made by him in the fourth quarter of 2024.”

During his campaign, Trump promised to create a crypto advisory board within his first 100 days in office and to replace Securities and Exchange Commission Chairman Gary Gensler, who became a prominent opponent of the industry during his tenure. The CoinDesk 20 is up 98% in the one month since the November election. Over the same period, Bitcoin is up 46%.

Another thing driving small-cap cryptocurrencies is the possibility that “the government’s expected strategic reserve could include other” US “cryptocurrencies” such as XRP and Salana token, Blum said.

“It’s unlikely, (but) it becomes a surprise and prompts speculators to buy the coins,” he said. “The best long-term value for investors will still be in Bitcoin.”

Trump also promised to establish favorable regulation to encourage “made in the USA” bitcoin mining domestically and create a strategic national bitcoin reserve. Investors expect volatility in the flagship cryptocurrency this year, with Bitcoin stuck in a tug of war between investors’ concerns about rising inflation under Trump and their optimism about his pro-crypto leadership.