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Market Commentary
November gave crypto investors a lot to be thankful for. With a monthly return of 37.4%, BTC surged to an all-time high of $99,800 on November 22nd, almost reaching the $100k milestone. The broader crypto market rallied, with ETH gaining 47.8% and the BGCI Index surging by 44.6% during the period.
The political landscape shaped market movements last month. The election of Donald Trump on November 6th signaled the arrival of a pro-crypto government. From accepting cryptocurrency donations during his campaign to proposing the creation of a U.S. bitcoin stockpile, Trump staked out a remarkably pro-crypto stance when compared to both the Harris campaign and the current Biden administration. After election night, Trump tapped Elon Musk and Vivek Ramaswamy to lead the newly created Department of Government Efficiency to cut government spending, sparking a meme-fueled rally that prompted DOGE’s price to rise by 172.1% in November.
But more substantial nominations came from the appointment of Scott Bessent, a hedge fund manager and a Bitcoin advocate, as the Treasury Secretary. Cantor Fitzgerald’s CEO, Howard Lutnick, who is a major Bitcoin holder and whose firm safeguards the U.S. Treasuries backing Tether’s stablecoin, was selected as Commerce Secretary. Former SEC Chair Jay Clayton, whose view towards crypto has evolved to be more supportive, was picked as the U.S. Attorney for the Southern District of New York (SDNY), a key law enforcement position. And just this week, Trump named Paul Atkins, a talented securities lawyer, former SEC commissioner, and proponent of innovation and a progressive approach to regulation, as SEC chair. These appointments indicate a pro-crypto shift in the executive branch of the government.
Reports indicate that Trump’s transition team is eyeing a larger role for the CFTC in regulating digital assets versus the SEC. Today, the CFTC does not have the authority to regulate any spot markets, but the sentiment suggests alignment with legislative proposals like Financial Innovation and Technology for the 21st Century Act (FIT21) and Digital Commodities Consumer Protection Act (DCCPA), and this can be seen as a nod to the crypto industry. Bloomberg analysts predict that both stablecoin legislation and FIT21, bills that would legalize and formalize stablecoins and crypto assets, have a 70% likelihood of passing Congress in 2025, adding further clarity for an industry that has struggled with uncertainty.
Corporations and institutional players have also increased their participation in the crypto space. MicroStrategy continued its aggressive bitcoin acquisitions, issuing $2.6 billion in convertible senior notes on November 20th to purchase more BTC, bringing its total BTC holdings to 402100 BTC as of December 4th. Marathon Digital, a crypto mining company, followed suit by securing $1 billion in funding through zero-coupon convertible notes to use the proceeds to acquire more BTC. The trend of putting BTC on company balance sheets highlights the growing corporate confidence in BTC as a strategic asset. Large traditional asset managers like Charles Schwab also began to tap into the crypto market by planning to offer spot crypto trading when regulations allow. Franklin Templeton, which has historically been developing its blockchain capabilities, formed a strategic partnership with Sui, a layer-one blockchain, to create new technologies and use cases.
With the launch of iShares Bitcoin Trust ETF (IBIT) options on November 19th, interest in BTC was particularly evident in the options market. The debut recorded 353,716 contracts on the first day, ranking it among the top 1% of all options products on the market. The activity was concentrated on nearer expiration contracts around 12/20/24 and 1/17/25, with notable interest in strike prices of 97k, 105k, and 115k. Additionally, speculative "lottery ticket" trades at the strike price of 175k highlighted the market’s bullish outlook for BTC.
Broadly speaking, November was an extremely bullish month for Bitcoin and digital assets, with 2024 marking the 4th best November for BTC in its 15-year history. Also, December has historically been positive, with 8 of the past 14 Decembers posting positive gains. Heading into 2025, the market is anticipating more clarity on Trump administration plans for digital assets, news of additional corporate or nation-state adoption, and evidence of a stabilizing macro picture as market catalysts.
Portfolio Considerations
The post-US election rally in the cryptocurrency market was widespread, encompassing more than just Bitcoin. The overall market capitalization surged to an impressive $3 trillion, marking a robust 70% year-to-date (YTD) increase. Bitcoin’s dominance temporarily reached 60%, its highest level in 2024, while ETH continued to experience a downtrend in November. As Ethereum struggled to maintain its dominance, Solana emerged as a strong contender, reaching a near ATH dominance of 3.8% on November 11 and an ATH price of $262 on November 22.
Solana's market capitalization has grown steadily throughout 2024, currently standing at $120bn, which is approximately 30% of Ethereum’s $405bn market cap. Notably, Solana's user activity and transaction data have significantly outpaced Ethereum’s, driven in part by its blockchain design optimized for high throughput and low transaction costs. These advantages make Solana a preferred platform for lower-value transactions, such as gaming and memecoin trading, which typically generate lower revenue streams compared to Ethereum’s high-value DeFi transactions and enterprise-grade applications.
A significant portion of Solana’s activity since March 2024 has been linked to memecoin trading and DEXs that support such activities. Solana’s appeal lies in its ability to process transactions with lower fees and minimal latency, making it attractive to younger, accessibility-focused users. While this has resulted in higher transaction counts, it has not translated to higher revenue compared to Ethereum. Due to its inherently lower transaction costs, Solana would require significantly more activity to generate fees comparable to Ethereum. Although Solana has occasionally outperformed Ethereum in terms of fees, the post-election rally marked a significant turning point. On November 22, as Bitcoin approached the $100,000 threshold, Solana’s aggregated fees exceeded Ethereum’s by $8 million—the largest gap recorded between the two leading Layer 1 blockchains.
Solana’s recent rally and strong user data are closely tied to memecoin activity, with Pump.fun playing a central role. Launched in January 2024, Pump.fun has enabled the creation of over 4.2 million tokens. The platform allows users to mint memecoins for free, with coins that achieve a certain market cap being listed on Raydium, a leading Solana-based DEX. Pump.fun’s rules prohibit token issuers from holding large positions in their creations, reducing the likelihood of conflicts of interest or pump-and-dump schemes. This so-called “fair launch” model avoids presales and promotes transparency.
Despite these safeguards, the majority of tokens launched on Pump.fun fail to meet the market cap requirements for listing on Raydium. Approximately 98% of memecoins created on the platform lack genuine community backing and fail to achieve significant market traction. Nevertheless, Pump.fun has seen high levels of daily activity, with over 150,000 daily active addresses and a trading volume of approximately $200 million. As of now, the platform itself has no associated token, but a recent private investment round valued the platform at a fully diluted valuation of $1.5 billion, offering a 1% equity stake for sale.
In contrast to Solana’s memecoin-driven growth, UNI has faced a different set of challenges. Despite its dominance as a decentralized exchange, Uniswap had underperformed its peers for much of 2024 as we highlighted in our previous monthly newsletter. However, the post-election period brought renewed optimism, driven by expectations of more favorable regulations and policy changes. Uniswap Labs, a frequent target of the SEC under former chair Gary Gensler, has seen its prospects improve following Gensler’s resignation. Since his resignation, UNI’s price has rallied by over 60%, reaching $15.50 and a market cap of $9.4 billion. The platform’s TVL remains robust, currently at $6 billion, though still below the peak of $10 billion achieved during the DeFi boom of 2021-2022.
Another cryptocurrency that has seen significant benefits from the resignation of Gary Gensler is XRP. As one of the earliest cryptocurrencies, launched in 2012, XRP has been at the center of one of the longest and most contentious legal battles with the SEC. In December 2020, the SEC filed its first lawsuit against Ripple Labs, the development team behind XRP, alleging that the token should be classified as a security. Over the next four years, Ripple Labs mounted a vigorous defense, arguing that XRP does not meet the Howey Test requirements for an investment contract. This legal standoff finally concluded in August 2024, with Ripple Labs agreeing to pay $125 million in fines—a significantly reduced amount from the initial $2 billion sought by the SEC.
During this protracted legal battle, XRP’s price and market capitalization struggled. Once the third-largest global cryptocurrency, XRP fell behind newer competitors like SOL, ADA, and BNB in relative size and prominence. However, November brought a remarkable reversal in fortunes for XRP, with its price surging nearly 280%. This rally was attributed not only to Gensler’s departure but also to Ripple Labs' CEO's alignment with former President Trump’s political resurgence. Ripple Labs has also bolstered its position by contributing to pro-crypto SuperPACs, supporting candidates and policies across both major parties that align with the industry’s interests.
XRP’s original appeal lies in its faster, cheaper, and more scalable transaction capabilities compared to Bitcoin. Targeted primarily at financial institutions, it was designed as an optimized solution for cross-border payments. While XRP lacked the robust smart contract programmability of platforms like Ethereum or Solana, it has steadily evolved to expand its use cases. A recent example is Archax, a UK-based digital asset service provider, which launched a money market fund in collaboration with abrdn, a leading UK asset manager, leveraging the XRP Ledger.
Despite its recent price rally, XRP and the broader Ripple ecosystem continue to lag behind Ethereum and Solana in areas like retail adoption, DeFi, and tokenization use cases. This is largely due to Ripple’s original institutional focus, which has limited its appeal in retail and developer-driven markets. It remains to be seen whether XRP can leverage its recent momentum as a catalyst to attract more active users and DeFi projects, thereby carving out a larger share of the broader cryptocurrency ecosystem after its lengthy legal battle.
Institutional Adoption Highlights
Bitcoin Hits $100,000, Driven by ETFs, Corporate Adoption, and Trump’s Victory
US Investors Hold 4.9% Of Bitcoin Supply Through ETFs: Institutional Adoption Driving BTC?
Crypto Performance and Volatility Data
