Changpeng Zhao also known as CZ, the billionaire crypto and former CEO of Binance, took to X on Sunday to weigh in on the volatile nature of cryptocurrency. His remarks came in the wake of President Donald Trump’s official launch of his own meme coin on Friday, $TRUMP, which saw its trading price surge from just a few cents to nearly USD 80 per token on Sunday evening.
“Volatility can be both bad and good,” CZ wrote, encapsulating the unpredictable dynamics of the cryptocurrency market.
Crypto is volatile.
(Volatility can be both bad and good.)
— CZ 🔶 BNB (@cz_binance) January 19, 2025
The $TRUMP meme coin, a type of cryptocurrency largely driven by the popularity of internet memes, experienced a dramatic rise before pulling back to around USD 40 on Monday morning, Asia time, coinciding with Donald Trump’s inauguration as the 47th President of the United States.
Available on the Solana blockchain, $TRUMP rapidly increased in value, reaching a market cap of nearly USD 14 billion and a trading volume of USD 18 billion on Sunday evening, according to CoinMarketCap.
However, as the price settled at around USD 43 on Monday, the market cap dipped to USD 8.7 billion, while trading volume remained high at USD 42 billion, surpassing XRP’s trading volume of USD 17.5 billion.
Regulatory Concerns in a Speculative Market
The frenzy surrounding $TRUMP has reignited discussions about the speculative nature of cryptocurrencies.
In his recent interview with Bloomberg early January, outgoing SEC Chair Gary Gensler emphasized the need for more regulation in the crypto market, citing its highly speculative and volatile nature
“I’ve been around finance for over four decades. Everything in the markets trades on a mixture of fundamentals and sentiment at any given time. But I’ve never seen a field so wrapped up in sentiment and not so much about fundamentals,” Gensler said.
He noted that many crypto projects are akin to venture capital investments, with a significant number being pump-and-dump scams.
“These 10,000 to 15,000 projects—many of them will not survive. They’re like venture capital investments. They’re not going to survive, but there’s also a fair number of small pump-and-dump schemes and other things in this,” he said.
He also reiterated his concerns about the unregulated nature of the crypto market, citing numerous pump-and-dump schemes and high-profile collapses, such as those involving Sam Bankman-Fried and Do Kwon, which resulted in billions of dollars in investor losses.
A New Era of Crypto and Politics
President Trump has stated his intention to fire Gensler immediately upon taking office. “On day one, I will fire Gary Gensler and appoint a new SEC chairman. I didn’t know he was that unpopular. Wow, I didn’t know he was that unpopular. Let me say it again. On day one, I will fire Gary Gensler. Woah,” Trump said.
Former SEC Commissioner Paul Atkins, known for his pro-crypto stance, has been nominated as Gensler’s successor.
Atkins’ nomination could herald a new chapter for cryptocurrency regulation in the U.S., aligning with Trump’s campaign promises to make the United States “the crypto capital of the planet.” This policy shift could influence not only the domestic but also the global crypto market, given the U.S.’s significant role in financial markets.
As the cryptocurrency industry watches closely, this transition in leadership at the SEC might foster a more welcoming environment for digital currencies, potentially leading to increased innovation and investment in blockchain technology.
However, the path forward remains fraught with regulatory challenges, market volatility, and the ongoing debate between fostering innovation and protecting investors.