Solana, Trump Memecoins Dropped Sharply on Donald Trump's Inauguration Day

The cryptocurrency market witnessed drastic price fluctuations on Tuesday during Donald Trump's inauguration, as excitement turned into disappointment after he declined to mention cryptocurrency in his first speech. The CoinDesk 20 Index, a broad market cryptocurrency benchmark, fell more than 5% during the session, while bitcoin (BTC) dropped from $106,000 to $101,000 before stabilizing around $103,000. Layer 1 network Solana (SOL), the focus of the weekend's frenzy of Trump-related memecoins, led the losses among major altcoins, falling nearly 10% from its recent record high. TRUMP, the official memecoin of Donald Trump, was launched on Solana on Friday, has dropped 30% from $50 in Trump's speech. It later recovered some losses but still dropped about 20% from the session high. MELANIA — named after First Lady Melania Trump and launched a day after TRUMP — dropped sharply by 46% before narrowing some losses. CoinGlass data shows that the volatility has also triggered a explosion in leveraged cryptocurrency trading, liquidating over $700 million of derivative products across all digital assets on exchanges until Monday. Nearly $500 million of the liquidated positions were long positions betting on price increases. Including the overnight sell-off before the inauguration, the total value of liquidations in the past 24 hours reached $1.2 billion, marking the largest deleveraging event this year.

There is great anticipation in the cryptocurrency industry for Trump's presidential term, with expectations of more crypto-friendly policies after years of regulatory uncertainty and repression. However, the launch of meme tokens linked to Trump just days before he took office has caused a speculative frenzy on cryptocurrency trading platforms and has made some prominent figures within and outside the industry unhappy. "It's absurd for him to do this," said Nic Carter, a founding partner at the cryptocurrency investment firm Castle Island Ventures, speaking to Politico. "They are further digging the deception with the introduction of memecoin". Congresswoman Maxine Waters, a senior Democratic member of the House Financial Services Committee, is the latest to condemn this action. "This meme coin represents the worst of cryptocurrency and shows why many regulators, supporters, and policymakers have long been concerned," she said in a statement on Monday. "These actions by President Trump will also tarnish the cryptocurrency industry, which has long struggled for legitimacy and a level playing field with other financial institutions".