Crypto’s comeback: What recent developments mean for sector, investors

Bangalore/Chennai: The crypto world is experiencing a thrilling resurgence. In the past few weeks, we have seen Bitcoin's (BTC) price soar to record highs, Dogecoin (DOGE) rally with surprising momentum, and, intriguingly, a pro-crypto stance from none other than the US president-elect, Donald Trump. Each of these developments adds a layer of excitement and complexity to the market. Let us see the context, get some perspective, and see how to prudently navigating these shifts wisely.

Bitcoin Rally: New era of price discovery
Bitcoin's recent rally has been remarkable, with prices pushing toward the $90,000 mark. BTC has gained substantial ground, drawing comparisons to previous bull runs. This is what analysts call the days of ‘new price discovery.’ Institutional inflows are surging, with over $2 billion pouring into Bitcoin spot ETFs over just a few trading days [ETF is exchange-traded funds]. This influx signals an evolving landscape where Bitcoin is increasingly seen as a hedge against economic uncertainty and inflation.

What fuels this rally?
In simple terms, Bitcoin is gaining ground as a legitimate asset class that is recognised by both retail and institutional investors alike. This rally is fuelled by strong fundamentals, including scarcity, increased mainstream adoption, and a global appetite for assets that are decentralised and resistant to traditional market volatility. For investors, this means Bitcoin is not just a speculative bet anymore—it is a calculated entry into a new financial paradigm.

Elon Musk, Trump, and DOGE
Yes, a very formidable and volatile combination. And, how does this connect to crypto? Here is the answer: Dogecoin (DOGE), often dubbed the ‘people’s crypto,’ has also seen a tremendous rally. With prices up nearly 250% in the past 30 days, DOGE has shown that it is more than just a meme. Recently, US President-elect Donald Trump announced the formation of the Department of Government Efficiency (nothing to do with the crypto DOGE), to be headed by prominent Dogecoin promoter Elon Musk (promoter of actual crypto DOGE) and entrepreneur Vivek Ramaswamy. This playful yet strategic nod to Dogecoin has emboldened the community and strengthened DOGE’s ‘memetic fundamentals.’ 

Community and culture-driven
Memecoins like Dogecoin are unique in the sense that they are driven by community and culture as much as by technology. While the fundamentals may not match Bitcoin’s, they show that crypto isn’t just about financial returns—it is about the narratives that resonate with people. However, while riding the DOGE wave can be exhilarating, investors should approach memecoins with caution, given their volatility and unpredictability.

US' pro-crypto stance: A turning point?
Perhaps. one of the most surprising developments has been President-elect Trump’s apparent endorsement of crypto-friendly policies. His administration’s focus on promoting technological efficiency and even nodding to Dogecoin shows a shift that could pave the way for a friendlier regulatory environment for crypto in the US This stance aligns with the vision many of us in the industry share: that crypto and blockchain have the potential to streamline systems, empower individuals, and bring transparency to financial transactions.

For investors, this shift in US policy is a potential game-changer. A pro-crypto stance from the world’s largest economy would encourage more institutional players to enter the market, adding liquidity, stability, and legitimacy. If this trend continues, we might see crypto embedded more deeply into the fabric of the global economy, which would, in turn, drive up valuations across the board. To state a case, the US is planning a strategic Bitcoin reserve for future. 

Navigating bull run: A few words of advice
With all this excitement, it is easy for investors to get swept up in the euphoria. However, ‘caution’ and a ‘steady hand’ should be the moot terms here. Here are some guiding principles for making the most of this bull run:

1. Diversify, but with purpose
Bitcoin and Ethereum remain the gold standard of crypto assets, with Bitcoin acting as a store of value and Ethereum as the foundation of decentralised applications. While Dogecoin and other memecoins offer unique opportunities, ensure your portfolio has a healthy balance. Investing heavily in highly speculative assets is akin to betting; approach it accordingly.

2. Stay informed, do not be swayed
Crypto markets are influenced by sentiment and news can move markets quickly. This is also the case with stock markets. However, the crusts and troughs can be really scary in crypto. Keep an eye on both market developments and regulatory changes. The crypto world is dynamic, and the information landscape can shift rapidly. So, get expert help and stay updated without getting caught up in short-term hype.

3. Take profits strategically
As much as bull runs offer gains, they can also turn around quickly. Set target prices for each asset and be disciplined about taking profits when they are met. This approach helps you lock in gains, especially in volatile crypto markets. 

4. Embrace volatility, but manage risk
Crypto is a highly volatile asset class by nature. Approach it with a risk management mindset. Only invest what you can afford to lose, and consider setting up stop-loss orders to protect yourself from sudden downturns.

5. Look beyond the short term
Crypto’s value proposition goes far beyond the current bull run. The underlying blockchain technology has the potential to reshape finance, governance, and even social structures. Focus on the long-term value that each asset brings to the table rather than short-term price movements.

Bigger Picture: Crypto as a transformative force
The convergence of these developments—from Bitcoin’s rally to Dogecoin’s cultural ascension, and a pro-crypto US policy—signals that crypto is moving beyond its early phase as a speculative niche. It is evolving into a robust ecosystem with real-world relevance. 

The road ahead is likely to be bumpy, with market fluctuations and regulatory uncertainties. However, if you approach it with knowledge, caution, and a balanced perspective, this crypto journey can be both rewarding and transformative. So, whether you’re a seasoned investor or just starting out, take a moment to appreciate the broader context. Crypto is here to stay, and it’s only getting started.
Let us enjoy the ride—responsibly, of course.
(Vikram Subburaj is the CEO of Giottus Crypto Platform. Views expressed are personal).