The ongoing surge in the cryptocurrency market continues to capture attention, with values shooting up significantly this week. However, it’s the altcoins trying to gain mainstream acceptance that have made the most noise, rather than the usual suspects like Bitcoin or meme coins.
Looking at the latest data from S&P Global Market Intelligence, we see some impressive gains. Solana (SOL) has jumped 21.2% over the last week, as of Friday at noon ET. Meanwhile, XRP has surged a remarkable 67.2%, Cardano (ADA) has climbed 46.4%, and Stellar (XLM) has seen a massive 119.1% increase.
### The SEC and Cryptocurrency
A major factor behind this week’s crypto excitement is the anticipation of a potentially more favorable landscape in the U.S. with President-elect Donald Trump. Central to this speculation is the possible replacement of Securities and Exchange Commission (SEC) Chair Gary Gensler, a move Trump has promised to tackle “on day one” of his administration.
Such a change could usher in a more lenient regulatory climate, potentially putting an end to some of the SEC’s legal actions against the crypto industry. XRP, in particular, has been in the SEC’s crosshairs, so clearer regulations and a friendlier environment would be welcome news. Stellar’s fortunes are tied to this as well, thanks to its connections with XRP founders and its designed role in the financial ecosystem.
### Momentum and Bitcoin Nearing $100,000
Another factor driving the crypto market is momentum, especially with Bitcoin nearing the $100,000 mark. This price level is a significant psychological milestone for traders, and Bitcoin has hovered close to it lately.
While Bitcoin differs from altcoins as it’s not initially intended for utilitarian purposes, it sets the tone in the crypto world. Its movement drives market sentiment, which is crucial for today’s trading environment.
### ETFs and Capital Influx
One more noteworthy development is the possibility of more exchange-traded funds (ETFs) entering the crypto scene, following the lead of Bitcoin and Ethereum earlier this year. Currently, there are applications underway for at least four Solana ETFs, potentially paving the way for a wave of ETFs targeting altcoins like XRP, Stellar, and Cardano—each among the top 20 cryptocurrencies by market cap.
ETFs are important because they inject fresh capital into the market, drawing in investors who might not be familiar with blockchain technology or crypto wallets. They also offer investment vehicles for funds that can’t directly hold cryptocurrencies, stirring excitement about their potential to boost cryptocurrency values.
### Is Speculation Overreaching?
While the bullish crypto market has enjoyed a fantastic run recently, there are feelings of unease about its reliance on speculation over possible policy shifts or capital flows. The specifics of what the new Trump administration will bring remain uncertain.
Furthermore, it appears clear that the future of the crypto economy will likely rely heavily on stablecoins, currently facilitating transactions worth trillions of dollars monthly. For cryptocurrency to truly revolutionize the financial landscape, it must serve as a medium of exchange rather than just a speculative asset. That’s the reason I’m not jumping on this latest market surge.
Travis Hoium holds positions in Ethereum and Solana. The Motley Fool owns and recommends Bitcoin, Cardano, Ethereum, Solana, and XRP. They maintain a disclosure policy.
