It turns out that a “crypto president” isn’t enough to keep money flowing into digital assets: since November 6, when Donald Trump was declared the winner of the election, Bitcoin has not only lost all its gains but is now trading 16% below that level, whereas gold prices, which BTC is supposed to replicate in digital form, has risen 94%.
Why is crypto demand fading?
It's not that people have suddenly realized that most cryptocurrencies are useless, as Minneapolis Federal Reserve President Neel Kashkari recently mentioned. Most investors already viewed digital assets primarily as speculative instruments. What real use could Fartcoin or Pepe Coin possibly have?
The more serious problem has been rising uncertainty, which has led investors to reduce risk.
At the forefront of this is geopolitics.
The largest drop in the history of cryptocurrencies, which occurred on October 11, 2025, followed former President Trump's announcement of 100% tariffs on Chinese imports and restrictions on the export of US software to China. Assets remain under pressure today amid the threat of new tariffs.
Tensions could push risky assets even lower if a large-scale operation unfolds in the Middle East — especially if it drags on longer than last year’s flare-up. On the other hand, if Iran eventually reaches a nuclear deal with the U.S., it could provide a welcome relief for the digital asset sector.
Concerns about an AI bubble and the risk of it bursting aren’t just weighing on big tech companies that have invested heavily — they’re also affecting the crypto industry. If the market’s main pillars weaken, sentiment could sour, and digital assets with little real value may not be reliable stores of wealth.
Then there’s the matter of the declining approval ratings for the so-called “crypto president.”
Beyond Trump’s direct connections to the crypto sector — including Trump and Melania coins — his declining approval ratings could influence the outcome of the midterm elections. The risk is that if Democrats gain control of the House, they could move forward with stricter regulations on the crypto sector.
What could accelerate a crypto selloff?
Ironically, one of the very factors that helped crypto rise — adoption by large institutional investors — could now add downward pressure. Companies that have accumulated hundreds or even thousands of bitcoins may be forced to start selling from their balance sheets to cover operating costs or service debt.
At the top of that list is Strategy. Just last week, the company added 592 BTC to its holdings, bringing the total to 717,722 BTC. While its unrealized losses now total billions of dollars, the company recently stated that even if the Bitcoin price were to fall to $8,000, it would still have enough assets to fully cover its outstanding debt.
Meanwhile, Bitdeer, once categorized as a “Bitcoin Treasury” company, has reportedly sold all its BTC holdings to invest in AI…