Trump’s Crypto Endorsement Sends Bitcoin Futures on a Wild Ride—Surge, Then Sharp Dip

Bitcoin futures just rode a political rollercoaster—and traders got whiplash.

The Trump Pump (and Dump)

Prices spiked after the former president doubled down on pro-crypto rhetoric, then nosedived as Wall Street remembered politicians love volatility more than your portfolio. Classic 'buy the rumor, sell the news'—with extra partisan seasoning.

Traders vs. Algorithms

Futures markets swung 8% in under an hour post-announcement. Human traders scrambled while algos feasted on the liquidity buffet. Someone's yacht payment just cleared.

The Cynical Take

Another day, another 'catalyst' that moves markets until the next tweet. At least this time the circus came with a side of price action.

Open Interest Spikes, Then Falls Back

Open interest in bitcoin futures—representing all active contracts yet to be settled—rose sharply from $9.71 billion to over $10 billion immediately after the executive orders. However, the surge didn’t last. Within hours, open interest retreated back to pre-announcement levels, indicating that many traders quickly exited their positions.

This pattern is supported by data from CoinGlass, which also shows a spike in cumulative volume delta (CVD). The elevated CVD indicates that buyers were aggressively trying to hold up prices, even as profit-takers started cashing out. This suggests that while speculative buying was strong, the rally may have lacked the conviction for sustained upside in the short term.

Bulls Still Under Pressure

Bitcoin bulls have faced persistent headwinds in recent weeks. Prior to Thursday’s rally, long positions worth an average of $275 million had been liquidated daily for the past three weeks. These losses were largely due to choppy price movements and investor caution ahead of macroeconomic decisions by the Federal Reserve.

Thursday’s reversal therefore comes as a temporary relief, though not necessarily a long-term turning point—at least not yet.

However, O’Shea believes the bigger picture is brightening. “These developments are collectively legitimizing crypto in the eyes of institutional and retail investors. That kind of policy support may set the stage for strong performance over the next 12 months,” he noted.

Bitcoin ETFs See Renewed Inflows

Another encouraging sign came from the ETF market. After a four-day streak of outflows, Bitcoin exchange-traded funds recorded $91.6 million in inflows on Wednesday, according to Farside Investors. This reversal hints at renewed investor confidence, despite last week’s pullback.

Earlier this week, CoinShares suggested in its Digital Asset Fund Flows report that the recent wave of outflows was likely a reaction to the Federal Reserve’s hawkish stance. The latest inflows, combined with Trump’s executive orders, may be helping to shift market sentiment back to the positive side.

Policy Impact: Long-Term or Short-Lived?

The inclusion of crypto assets in 401(k) plans is a significant regulatory shift. It signals institutional recognition of digital assets as legitimate investment options. Additionally, the ban on debanking crypto businesses addresses one of the industry’s longest-standing concerns: limited access to banking services.

Still, traders appear to be approaching the news with caution. The rapid unwind in open interest suggests that while the headlines were bullish, most participants were not ready to commit long-term capital—at least not yet.

That said, market watchers believe the political backing could serve as a catalyst for broader adoption. If these policies are implemented effectively and consistently, they could provide the regulatory clarity and financial infrastructure support needed to fuel the next phase of crypto growth.

Conclusion

Trump’s executive orders may not have created a sustained breakout in Bitcoin’s price, but they mark an important shift in U.S. crypto policy. While short-term market activity reflects profit-taking and uncertainty, the long-term implications could be far more significant. With renewed ETF inflows, a friendlier regulatory tone, and strong buying interest, Bitcoin bulls may find themselves on firmer ground in the months ahead—even if volatility remains the norm.