Crypto and stock markets hit new highs on January 21, with Bitcoin making up most of the ground lost during its decline the day before.
Stock markets in the United States were closed on Martin Luther King Jr. Day on Jan. 20, but traders’ optimism about what is seen as a market-friendly Trump presidency and to the business climate was reflected from the opening.
The US Dollar Index continued its decline, falling 1.27% from its two-year high of 110 on January 15 to currently trading slightly above 108. As 2024 drew to a close and just In early 2025, market participants’ anxiety over the new Trump administration and a handful of other geopolitical tensions were reflected in the sharp rise in U.S. Treasury and bond yields. DXY. After former President Biden’s smooth transition to a self-appointed, economically-focused Trump Cabinet, the DXY cooled, as did Treasury yields.
DXY vs BTC 3-day chart. Source: TradingView
Many analysts, CEOs, and investment fund managers have publicly shared their optimistic views regarding President Trump’s economic agenda. This optimism is clearly reflected in the S&P 500, DOW and QQQ indices which gained 1.21%, 0.82% and 2.79% respectively. Part of the rebound in stocks can also be attributed to investors’ belief that Trump’s original plan to impose tariffs on several countries has cooled.
SPX, DOW and QQQ 3-day chart. Source: TradingView
Bitcoin strategic reserve or not, BTC rebounds
Following the positive waves seen in the markets, Bitcoin (BTC) also rebounded, gaining 3.8% to reach an intra-day high of $107,240. Although BTC failed to eclipse its Jan. 20 all-time high of $109,588, the rebound is likely welcome, especially after anxious investors expressed disappointment over President Trump making no mention of cryptography on inauguration day and the absence of a decree linked to a strategic reserve Bitcoin or crypto in general.
Even though Trump may have gone back on his first day promises to the crypto community, many of whom donated millions of dollars to his campaign through lobbying and personal contributions, positive news emerged from the White House on January 21.
As reported by Cointelegraph, the United States Securities and Exchange Commission took the first step toward reforming U.S. crypto regulatory policy on January 21 by revealing a new crypto task force tasked with developing a new framework for digital assets. The task force is led by longtime crypto advocate Commissioner Hester Peirce, and many investors are already happy with the appointment of Commissioner Mark Uyeda, who currently serves as Acting Chairman of the SEC.
Related: 80% of Short-Term Bitcoin Holders Regain Profits, Analyst Says: “FOMO in Full Swing”
Bitcoin also appeared to react positively to comments from Bank of America CEO Brian Moynihan, who said banks around the world would happily make crypto payments “a real thing” if regulations were clear enough to do so.
While interviewed by CNBC at the World Economic Forum in Davos, Switzerland, Moynihan said:
“We already have hundreds of patents on blockchain, we know how to get into this field.”
Taken in a broader context, Moynihan’s comments match those of Bitwise chief investment officer Matt Hougan, who has repeatedly predicted that “companies buying Bitcoin is a much bigger deal than most people realize.” think so.”
The three sources of insatiable demand in 2025: corporations, ETFs and governments. https://t.co/vatSG6wxgF
– Matt Hougan (@Matt_Hougan) January 6, 2025
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research before making a decision.
