Bitcoin Price Falls. Trump Media Moves Closer to Crypto ETF. — Barrons.com
By Elsa OhlenBitcoin edged lower Wednesday as traders, weighed up a number of potential catalysts, including the possibility of a new Truth Social ETF.Bitcoin traded down 1.2% over the last 24 hours to $105,440. The price of the world's largest digital coin hit a record high of more than $111,000 in May, and has since pared some of those gains but remained above the psychologically important $100,000 level.Smaller cryptos were mixed: Ether was up 1.1%, while XRP rose 0.2%. Solana fell 3.1%.Trump Media, the social media company largely owned by President Donald Trump, is planning to launch a Truth Social Bitcoin ETF similar to existing spot Bitcoin funds, according to a filing with the Securities and Exchange Commission. The company had said earlier this year it would move into financial services, including Bitcoin.Taken together with other recent political and financial developments — including efforts to regulate stablecoins — Bitcoin is becoming a central financial asset which could open the door to a new wave of institutional and retail investors, according to XS.com analyst Rania Gule.However, not all in the crypto space were positive about Trump Media's Bitcoin ventures. "As much as people see Trump being in power as a positive for Bitcoin in the U.S. — and from a regulatory perspective, it has been — it's starting to go beyond what the industry actually want," said Danny Scott, CEO of CoinCorner, a crypto trading platform."I can appreciate that the Trump team may genuinely believe in Bitcoin as the future, but in my opinion, they are now abusing their position and influence to launch their own private ventures that benefit themselves personally, more than for the good of Bitcoin," Scott said, referring to the latest Trump Media crypto announcement, as well as the memecoin $TRUMP.Separately, Trump signed an executive order Tuesday to increase tariffs on steel and aluminum to 50%, coming into effect at midnight. Whether the market had expected Trump to follow through with these levies, or if it's a sign of tariff fatigue, neither markets nor cryptos moved much on the news.The S&P 500 and the Nasdaq Composite also pointed higher in mid-day trading Wednesday.Cryptos are typically seen as risk-assets that fall when economic conditions or uncertainty worsen. As of late, Bitcoin has at times broken with that assumption, trading more in line with safe-haven assets like gold.Bitcoin has risen about 50% in the last 12 months, outperforming both stocks and gold. Much of Bitcoin's gain can be attributed to traders' optimism around expectations that the Trump administration will be more crypto-friendly than previous administrations.There are still many ways the crypto rally could get derailed. Apart from legislative efforts to regulate cryptos, which may or may not pass, digital assets can also be sensitive to shifts in the economic climate.If U.S. import taxes drive prices higher, that could lead the Federal Reserve keeping interest rates higher for longer which is typically a bearish sign for cryptos.Write to Elsa Ohlen at [email protected] content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.