Investing.com-- Bitcoin slid on Thursday after a short-lived rally on hype over more crypto-friendly policies from President Donald Trump, with his recently launched memecoin also clocking steep losses.
Cryptocurrency markets took fleeting support from the Securities and Exchange Commission, which, under new leadership, said it will form a task force to help advise on crypto regulation.
Markets were left wanting as Trump did not sign any executive orders related to crypto in his first few days in office, despite several industry participants hoping for such a move.
The launch of $TRUMP, which logged wild price swings since its debut, also contributed to additional volatility in markets, while hype over artificial intelligence saw risk-heavy traders turn more biased towards equity markets.
Bitcoin fell 1.4% to $102,530.0 by 09:14 ET (14:14 GMT). The world’s biggest cryptocurrency briefly hit a record high above $109,000 before Trump’s inauguration this week, but has since logged steep declines.
Bitcoin down as Trump boost fades
Bitcoin largely failed to maintain its gains this week, as optimism over crypto-friendly policies under Trump appeared to be short-lived.
While the SEC announcement does herald some progress towards friendlier regulation, the commission provided few details on just what policies will be covered by its task force. The SEC also did not provide a timeline for new regulation.
A major point of contention for crypto markets was also that Trump signed no crypto-related executive orders, while his threats of tariffs on major economies dented risk appetite.
Trump’s memecoin- $TRUMP- slid nearly 13% to $35.27 on Thursday, sliding further from record highs of nearly $80 hit just after its launch. The token raised some concerns over the ethics of Trump using his influence to further his personal wealth.
The President was seen largely avoiding questions over the billions of dollar of paper gains he had likely made from $TRUMP.
Crypto sentiment approaching 'extreme euphoria': Needham
Needham & Co. said that its proprietary ‘Crypto Euphoria Needham Diagram’ (CEND) has reached its highest levels since the index’s inception, signaling heightened market sentiment for cryptocurrencies and nearing “extreme euphoria.”
The CEND index, which measures crypto market cycles using various metrics, rose to 64 this week, up from 55 in December 2024. While this marks a significant increase, it remains below the October 2021 peak of 82.
“This week CEND reached its highest levels since we began publishing the index,” the firm noted. “Nearly every underlying metric we analyze to track the crypto cycle has gone higher following the Trump inauguration.”
The index incorporates six key metrics, analyzing sentiment among retail, crypto-native, and institutional investors, alongside “risk on” indicators like the MVRV Z-score and Bitcoin dominance.
Blackrock’s Fink sees Bitcoin at $700,000
BlackRock (NYSE:BLK) CEO Larry Fink offered some positive comments on Bitcoin, stating that he believed the crypto could rise to a $700,000 price if more people adopted it on concerns over the economic and political stability of their countries.
Fink told Bloomberg that he believed in the utilization of Bitcoin as an internationally based instrument, although he clarified he was not promoting the crypto.
BlackRock had last year launched an exchange-traded fund that tracked the spot price of Bitcoin- iShares Bitcoin Trust (NASDAQ:IBIT). The launch had initially attracted a deluge of capital flows in early-2024, although inflows have since floundered.
Crypto price today: altcoins track Bitcoin losses
Broader crypto prices fell in tandem with Bitcoin. World no.2 crypto Ether fell 1.8% to $3,227.73, while XRP retreated 2.4% to $3.089.
Solana, Cardano, and Polygon sank between 1.8% and 5%, while among meme tokens, Dogecoin dropped 2.9%.
Ambar Warrick contributed to this report.