Market update: Crypto market cap surges to US$3.42T

The weekly crypto close: Monday, 20th January 2025

TLDR

• Crypto market surges to US$3.42T
• Solana's US$10b comeback: Trump’s meme coin boosts network
• Melania Trump enters the crypto space

The weekly trading stats as of Monday, January 20th at 11:00 am AEDT, based on data from Tradingview in USD.

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Crypto market surges to US$3.42T as Bitcoin and Solana lead the charge

The crypto market enjoyed a strong week, gaining nearly 6% and closing at a hefty US$3.42 trillion, up by US$190 billion. Bitcoin (BTC) soared 7.18% to close at US$101,331.57 after hitting a high of US$106,422 on Sunday.

XRP also had an impressive run, surging 18.13% to reach as high as US$3.40 before settling at US$2.96. Solana (SOL) turned heads with a 33.90% weekly gain, fuelled by a flurry of on-chain activity after the highly publicised launch of Donald Trump’s meme coin on Friday night. The listing drew significant attention, propelling Solana to a peak of US$295.83 before closing at US$252.42.

While Chainlink (LINK) jumped 22.68% to US$24.34, Ethereum struggled for the second week in a row, slipping 1.6% to end at US$3,215.12. The market's standout performers highlight growing retail and institutional interest, with Trump’s meme coin adding a unique political dimension to the crypto landscape.

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Solana's US$10 billion comeback: Trump’s meme coin boosts network resurgence

The launch of Donald Trump’s $TRUMP meme coin has breathed new life into the Solana ecosystem, pushing its total value locked (TVL) to over US$10 billion for the first time since the collapse of FTX.

Within days of its launch, $TRUMP has climbed to become the third-largest meme coin, trailing only Shiba Inu (SHIB) and Dogecoin (DOGE) in market capitalisation. A trading frenzy ensued on decentralised exchanges, with Moonshot, a meme coin trading platform, reporting US$400 million in trading volume and onboarding over 200,000 new users in just 12 hours.

The excitement bolstered confidence in the launch of a spot Solana exchange-traded fund (ETF), with Polymarket traders raising the odds of an ETF approval by mid-year from 43% to 61%. This milestone not only showcases Solana’s capacity to handle significant activity but also reflects a more innovation-friendly U.S. regulatory environment.

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Melania Trump enters the crypto space

The wild world of Trump-branded meme coins took a dramatic turn when Melania Trump launched her own token, MELANIA, just as Donald Trump's TRUMP coin plunged 38% after hitting a US$15 billion peak. Within two hours of launch, MELANIA reached a market cap of US$6 billion, attracting over 45,000 wallets.

Questions linger over transparency and insider holdings

Amid the excitement surrounding $TRUMP, concerns about its structure and insider control are growing. Notably, 80% of the coin’s supply is reportedly held by entities affiliated with Donald Trump, raising transparency and risk questions. Similarly, Melania’s recently launched token, MELANIA, has come under scrutiny for its token distribution, with critics highlighting that nearly 90% of the supply is concentrated in a single wallet despite claims of broader allocation.

These concerns deepen fears of a potential large-scale sell-off by insiders once restrictions lift, which could damage investor confidence and reinforce negative perceptions of the crypto industry. To mitigate these risks and safeguard the sector's reputation, ensuring robust accountability and clear management of insider holdings will be crucial.

Political influence adds a new twist to crypto

The introduction of a meme coin tied to a political figure like Trump introduces an unprecedented dynamic to the industry. While the connection to a high-profile personality can drive adoption, it also risks politicising cryptocurrencies. This development raises questions about how the industry will navigate the intersection of finance, politics, and regulation in the years ahead.

Education and regulation are key to managing growth

As millions of retail users enter the crypto space, the need for regulation and education becomes more pressing. Without proper safeguards, new entrants may fall victim to misinformation or speculative risks. The industry will continue to advocate for robust investor protections and promote informed decision-making. The impact on the sector depends on the steps taken by regulators and industry participants to guide users safely and responsibly into the market.

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