A number of analysts and market observers are warning that a bubble in Bitcoin (BTC) and other cryptocurrencies could burst as U.S. President Donald Trump returns to the White House.
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The warning comes as Bitcoin trades at a record high of $109,333 as Trump is sworn in for a second term as America’s president. The urging of caution also comes as Trump and his wife Melania each launched their own cryptocurrencies ahead of the inauguration, adding to the current frenzied trading of BTC.
Wilson Wang, founder of the blog HFI Research, said in a post that the crypto sector looks like it is about to “spiral out of control.” Separately, Harris Kupperman, the chief investment officer of Praetorian Capital, said in a note to clients that the Trump and Melania coin launches might be the catalyst for the bursting of what he called “a crypto bubble.”
Other chatter online is talking about Bitcoin and other crypto hitting a “tipping point” and “jumping the shark” as Trump is inaugurated.
More Trump Coins?
It appears that other members of the Trump family might also launch their own cryptocurrencies in the not-too-distant future. The Trump family’s World Liberty crypto project has purchased domain names for digital tokens under the names “Eric Trump” and “Barron Trump,” two of the president’s sons.
Both “Trump Coin” and “Melania Coin” have no underlying value and are being referred to by analysts as “meme coins.” The Melania Coin’s website says that her cryptocurrency is meant for “collecting and entertainment purposes only.”
That said, a frenzy has greeted the launch of the Trump Coin in recent days, with the crypto peaking at over $75 per digital token before falling to $40 in a matter of hours. Bitcoin’s price has now risen 154% in the last 12 months.
Is BTC a Buy?
Most Wall Street firms don’t offer ratings or price targets on Bitcoin, so we’ll look at the cryptocurrency’s three-month performance instead. As one can see in the chart below, the price of BTC has risen 56% in the last 12 weeks.
