DeFi tokens jump 30% after Trump victory
DeFi tokens surged by over 30% as traders anticipated a more supportive regulatory environment under the Trump administration.
According to Charlie Sherry, head of finance and cryptocurrency analyst at BTC Markets, this shift in sentiment has bolstered the “investment appeal” of holding utility tokens.
“Until recently, DeFi tokens have been largely labeled as ‘useless governance tokens. However, investors and tokenholders have been buying on the bet that one day, these protocols will be able to pass value back to the token through fees earned by the protocol,’” Sherry explained.
Data from CoinGecko indicated that UNI led gains with a 35% increase, reaching $9.58, while other tokens like Lido DAO (CRYPTO:LDO), Ethena (CRYPTO:ENA), AAVE (CRYPTO:AAVE), and Maker (CRYPTO:MKR) rose over 20% from recent lows.
The renewed optimism in the DeFi market comes on the heels of Donald Trump’s decisive win in the U.S. presidential election on Nov. 6, defeating Vice President Kamala Harris.
This political change could lead to SEC Chair Gary Gensler stepping down by the end of the year, according to 10x Research.
The potential shift has sparked hopes for a friendlier regulatory stance towards DeFi, prompting traders to adjust their strategies accordingly.
Sherry pointed out that concerns over regulatory enforcement had previously stalled the implementation of “value accrual mechanisms.”
He highlighted the SEC’s investigation into Uniswap Labs as an example of the uncertainty faced by DeFi protocols.
However, new proposals such as Aave’s “fee switch” could bring intrinsic value to tokenholders.
Sherry also noted that Uniswap’s Unichain layer 2 development could transform UNI into a utility asset.
Markus Thielen, head of research at 10x Research, attributed some of the price movement to a “buy the laggard” strategy by traders, suggesting underperforming assets could emerge as future leaders.
Additionally, speculation about BlackRock’s potential promotion of a spot Ether ETF in 2025 could further influence the market.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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