The volatile world of cryptocurrency is experiencing a remarkable comeback, propelled by a mix of political endorsements, celebrity influence, and market speculation. Leading the charge is none other than billionaire Elon Musk, a fervent cryptocurrency enthusiast whose proximity to President-elect Donald Trump is reshaping the financial landscape.
Musk, recently appointed by Trump to head the newly established Department of Government Efficiency (Doge)—a playful nod to the cryptocurrency dogecoin—has reignited global interest in digital currencies. Dogecoin, initially created as a joke, has seen its value soar since the presidential election, doubling its market cap to approximately NZ$125 billion. Meanwhile, bitcoin surged to a record high of nearly US$100,000 before stabilizing slightly.
A History of Peaks and Valleys
Cryptocurrency’s resurgence marks a stark contrast to its recent troubles, where scandals and bankruptcies tarnished the industry. High-profile failures like Sam Bankman-Fried’s FTX—once a beacon of crypto success—shook investor confidence. Bankman-Fried’s empire collapsed amid allegations of massive fraud, leaving billions unaccounted for and earning him a prison sentence.
Despite these setbacks, cryptocurrencies have shown remarkable resilience. Their unique decentralized nature, backed by blockchain technology, continues to attract investors and institutions. During Trump’s campaign, cryptocurrency companies poured millions into backing supportive candidates, signaling the industry’s growing influence in Washington.
Celebrity Advocacy and Public Sentiment
Over the years, cryptocurrency has drawn endorsements from A-list celebrities, fueling both excitement and skepticism. Stars like Gwyneth Paltrow, Tom Brady, Gisele Bündchen, and Naomi Osaka lent their names to various crypto projects, often to mixed results. The 2022 Super Bowl, dubbed the “Crypto Bowl,” was saturated with cryptocurrency advertisements costing up to US$7 million per 30-second slot.
However, the subsequent market crash led to public backlash, with celebrities accused of steering fans toward risky investments. Many suffered financial losses themselves, tarnishing the allure of digital assets.
Trump’s Crypto Pivot
President-elect Trump, who once dismissed cryptocurrency as a “scam,” has dramatically shifted his stance. At a crypto conference last year, he declared his ambition to make America “the crypto capital of the planet.” His proposals include creating a national bitcoin reserve, establishing a crypto advisory council, and easing regulatory pressures on the industry. These moves have further fueled optimism among crypto advocates.
Trump’s relationship with Musk—dubbed the “dogefather” for his advocacy of dogecoin—underscores this newfound alignment. Trump Media’s reported exploration of a cryptocurrency payment platform, under the trademark “TruthFi,” has added another layer of intrigue to the administration’s crypto-friendly agenda.
A Roller Coaster Ride Ahead
While cryptocurrencies remain far from replacing traditional currencies, their cultural and economic impact is undeniable. From influencing art markets to reshaping political campaigns, digital currencies are carving a niche in global discourse. Yet, the inherent volatility of these assets keeps many investors cautious, wary of another potential crash.
As Justin Sun, founder of a cryptocurrency platform, aptly put it after purchasing an artwork for US$6.24 million, the intersection of cryptocurrencies, art, and memes represents a “cultural phenomenon.” With Trump’s presidency on the horizon, the cryptocurrency world is bracing for what promises to be a turbulent yet transformative era.
