Trump inauguration isn’t the key factor for Bitcoin’s future, says analyst

Bitcoin remains the front and centre of all financial debates following Trump’s inaugural speech on Monday.

Trump focused primarily on national issues like immigration, economic policies, and energy production in his inaugural address.

Despite his recent support for BTC, the speech was rather silent on crypto.

That made the price of Bitcoin drop from a high of $109,000 this morning to around $103,000 at writing – and the coming weeks could see it sink further, as per Markus Thielen of 10x Research.

What’s more important for Bitcoin than Trump 2.0?

Trump’s return to the White House has been established as a material tailwind for Bitcoin as the President-elect has committed to making America the crypto capital of the world.

Still, Markus Thielen is not entirely convinced that Trump’s inauguration earlier today was the most important thing for Bitcoin.

It could very well catalyse a near-term pop in BTC – but those gains could prove to be rather short-lived as the focus eventually turns back to the broader headwinds.

“Very shortly, the market is going to focus again on the stronger employment data and on the more hawkish Fed that’s usually a headwind for Bitcoin,” he argued last week on CNBC’s “Street Signs Asia”.

Here’s why the Bitcoin rally may have peaked already

Markus Thielen attributes the crypto market rally in recent months more to the Fed’s jumbo rate cut in September and less to the overall optimism related to pro-crypto policies under the Trump presidency.

But the central bank has since turned more hawkish again as signs of weakening in the US labour market reversed in the final two months of 2024.

Theilen no longer expects the Federal Reserve to cut rates any further any time soon, which is why he’s convinced the BTC rally has peaked for now and the crypto asset is not very likely to hit record levels in the coming months.

In other words, the 10X Research analyst sees the Trump 2.0 optimism as baked into the price of Bitcoin already at current levels.

What else could contribute to a potential pullback in BTC

Thielen is not alone in projecting at least some weakness in Bitcoin ahead.

The founder and chief executive of KKM Financial, Jeff Kilburg is in the same league as well.

Investors have been buying the rumour that the incoming US government will take an aggressively positive stance on Bitcoin right off the bat on January 20^th.

But they are likely to sell the news now that Trump did not mention cryptocurrencies in his inaugural speech.

“If we don’t have the US government buying Bitcoin in the first 100 days, we’ll see a pullback in BTC,” he told CNBC in an interview today.

Note that Bitcoin is currently up 50% versus its price on the election day (November 6^th).