Author: Ma He, Foresight News

On a winter night in 1915, under the red walls of Xinhua Gate in Beiping, China was engaged in a gamble that would determine its destiny.

The elites who had once shouted for the Republic, the wealthy terrified by turmoil, and even capitalist giants across the ocean held their breath as they watched the man seated in the central government's chair—Yuan Shikai. Four years prior, the revolutionary army had overthrown the Qing dynasty, but the foreign powers chose Yuan rather than Sun Yat-sen to steer the country.

However, Yuan Shikai was not the savior that people hoped for; under the support of his loyalists, he proclaimed the "Hongxian" era and once again led China back to imperial rule. But just 83 days later, his Chinese Empire was met with disdain and collapsed, leading China into decades of warlord chaos.

A hundred years later, in the emerging financial arena of cryptocurrency, people are also searching for their "strongman." In the 2024 U.S. election, Trump was viewed by the crypto industry as the savior who could break regulatory shackles and lead the industry into the mainstream. From venture capitalists in New York to crypto newcomers in Silicon Valley, from traditional financial institutions on Wall Street to retail investors in Southeast Asia, everyone placed their bets on this "crypto president."

However, just a year later, when his tariff policies became the catalyst for the crash on October 11, 2025, panic swept through the entire crypto market as countless leveraged bulls were mercilessly liquidated. People suddenly realized that the much-anticipated Trump might be the main culprit behind this round of crypto winter.

The relationship between Trump and the crypto industry can best be described as "success and failure both depend on the same cause."

On March 4, Trump retweeted a post from the CEO of Coinbase, reaffirming his commitment to make America the global hub for cryptocurrency. His slogan was loud and appealing, but was reality as he proclaimed?

The last person favored by Trump provided a contrary answer. When Musk's sweet collaboration with Trump at the White House lasted only a few months before ending in a breakup, it became clear that Trump's vision for the future of cryptocurrencies was but a fantasy.

After taking office, Trump indeed took action. The notorious SEC Chairman Gensler quietly left in early 2025, and he was replaced by Paul Atkins, who had a more favorable attitude towards the crypto industry. Lawsuits against several crypto companies were shelved or dismissed, and exchanges like Coinbase and Kraken breathed a sigh of relief. Trump also signed an executive order calling for a dedicated working group to explore how to integrate cryptocurrency into the U.S. financial regulatory framework.

These measures did bring a boost to the market in the short term. Bitcoin's price surged from $52,000 in September 2024, and by early October 2025, BTC temporarily broke through $126,000, setting a new historical high. People began to talk about "institutional bull" and "ETF bull," as if a new golden age was beginning. Ethereum, although underperforming, continued to rise for several months following a significant correction, hitting new historical highs.

As of March 3, 2026, the total net inflow for U.S. Bitcoin spot ETFs reached $55 billion, and Ethereum spot ETFs accumulated $11.62 billion.

However, this optimism was short-lived. Just as Yuan Shikai's early republican experiment ultimately led to a restoration of monarchy, Trump's "friendliness" toward the crypto industry slowly revealed its true nature.

The Family's Wealth Extraction Frenzy

In January 2025, just before Trump's inauguration, a meme token named "TRUMP" quietly launched. This token named after the president saw its price soar to $77 within just a few days of launch, and its market cap reached several billion dollars, creating an exaggerated wealth effect; some players in the Chinese community earned profits in the millions or even tens of millions from this meme coin.

From the perspective of token economics, the Trump family held a very high share in these two tokens. According to on-chain data analysis, a significant portion of the total supply of the TRUMP token is held by Trump himself and his associated entities.

The "Creators & CIC Digital" group held a total of 80% (800 million tokens), which is the major holding portion of the token. According to official and credible sources, these portions are controlled by two entities related to the Trump family:

• CIC Digital LLC: This is a subsidiary of the Trump Organization, directly associated with the Trump family.
• Fight Fight Fight LLC: Owned by Celebration Cards LLC, this entity is also linked to Trump-related projects.

These entities together hold the remaining 80% of the tokens.

Currently, the token price has dropped to around $3.5, a reduction of about 20 times.

Following this, First Lady Melania also launched her own token "MELANIA," which surpassed a market cap of $10 billion on its first day but then quickly crashed due to insider selling, shrinking its market cap to less than $2 billion. In June 2025, according to monitoring by Lookonchain, the official meme coin MELANIA team of the First Lady sold a total of 821,800 MELANIA tokens (8.22% of the total supply) through 44 wallets over the past four months, cashing out 244,934 SOL (approximately $35.76 million).

The next buyer became the unwitting victim.

For a time, the Trump family seemed to become the "token issuing family" in the crypto world.

In October 2025, according to a Financial Times investigation, the Trump family had earned over $1 billion in pre-tax profits from various cryptocurrency-related products and companies in the past 12 months.

This behavior of utilizing political influence for personal wealth accumulation is extremely rare in American history.

Ulysses S. Grant in the 19th century shares a commonality with Trump: both arrived in politics as "outsiders" or "saviors." Grant was a hero of the Civil War, with high hopes placed upon him by the public; Trump, as a business mogul, promised to "make America great again."

However, Grant's administration became one of the most corrupt in American history. Although Grant himself may not have had a subjective desire for money, he was extremely protective, allowing family members and subordinates to accumulate wealth on a massive scale. The most notorious among these scandals was the "gold manipulation case" in 1869—Grant’s close associates attempted to manipulate gold prices, resulting in near-catastrophe for the American financial market.

Trump's meme coin operation bears striking similarities to the scandals of the Grant era. While there is currently no evidence to indicate that Trump directly manipulated the market, using his presidential identity to endorse family tokens is essentially a form of leveraging power for personal gain. Worse still, this behavior has set a dangerous precedent for the entire industry.

After the Trump couple’s token launches, imitators followed quickly. Argentine President Javier Milei, who claims to be an "anarcho-capitalist" leader, also launched his own meme token in 2025. However, this token launching farce ultimately ended in scandal—massive insider trading was exposed, and early investors (including Milei's friends and family) sold at a high-point in token prices, while ordinary retail investors were left with nothing.

Meme coins, originally marked by humor and community culture in crypto, gradually devolved into "cash machines" under Trump's demonstrative effect.

More and more political figures, influencers, and celebrities began issuing their own tokens, turning the trust of fans into personal wealth. This accelerated inflation of the bubble not only weakened the credibility of the crypto industry but also increasingly associated the term "cryptocurrency" with "scam" and "speculation" in mainstream discourse.

It was from that time onwards that a $70 billion FDV became an insurmountable barrier for meme coins, leading many meme coins downwards.

Data from DefiLlama shows that January 2025 was the peak moment for Pump.fun's transaction volume, after which it began to decline significantly, with activity levels dropping sharply. In January 2025, the highest daily transaction volume could reach $550 million, but now it hovers around $60 million per day.

Even after the emergence of so-called "Binance Life" and other once-hyped meme coins on the BNB Chain, their FDV failed to exceed $1 billion.

After October 11, as the crypto market turned bearish, meme coins also stagnated.

Market liquidity was consumed by token-issuing groups and savvy traders.

Another crypto project, WLFI, has a team of executives made up of the Trump family and the Witkoff family, including Donald Trump Jr., Eric Trump, and the nominal youngest son Barron from the Trump family.

Currently, under a series of incentive activities, the market cap of the stable coin USD1 has surged to $4.6 billion, and the Trump family holds about 38% equity in WLF Holdco LLC through the entity DT Marks DEFI LLC, while WLF Holdco LLC is the sole member of World Liberty Financial, Inc. (which is responsible for developing the WLF protocol and operating the governance platform). DT Marks DEFI LLC is held by Trump family-associated entities, with Trump himself holding approximately 70% equity in the entity.

After June 2025, his shareholding ratio further dropped to about 40%, stabilizing recently at about 38% (according to the latest official statement, the acquisition of 49% equity by an investor affiliated with UAE Sheikh Tahnoon bin Zayed Al Nahyan is related, which will finalize in early 2026, bringing $500 million in funds, and the Trump family entity will receive $187 million).

In addition, the Trump family and related parties hold 22.5 billion WLFI tokens (total supply 100 billion tokens), which, at the current price of $0.1, is valued at $2.25 billion. On the other hand, the family will also receive 75% of the net proceeds from WLFI token sales (after deducting reserves, expenses, etc.).

Cryptocurrency is a Tool, Not an End

If meme coins have become the Trump family's cash machine, the series of ensuing tariff wars revealed Trump's true attitude towards crypto: in his eyes, crypto is perhaps just a tool, rather than a significant innovation worth attention.

While the Trump administration indeed regulated the industry more leniently than its predecessors, this leniency is selective and utilitarian. For areas that can bring direct benefits to the Trump family (like meme coins), regulation is virtually non-existent, leading to rampant anomalies.

The essence of this "selective friendliness" is to gain votes, to repay voters, rather than to truly promote the healthy development of the crypto industry. Trump needs the support of crypto industry voters; thus he made various commitments during the campaign. However, he does not genuinely understand or care about the long-term value of this technology. Once the interests of the crypto industry conflict with Trump's political agenda, the former is often sacrificed.

The cryptocurrency field, having a relatively short history, is largely dominated by younger holders who are tech elites. Before the election, the voices and screams of young people were crucial for votes; Trump did not miss this opportunity to gain favor from industry voters by making promises and attending crypto conferences. By loudly promising in his campaign speeches to "end the repression of the crypto industry," he successfully packaged himself as the guardian of technological innovation.

On the other hand, Trump's longstanding image has not been well-received on Wall Street; from multiple bankruptcies to legal disputes, traditional banking institutions have never stopped their caution towards him. Even after taking office, some top-tier capital in Wall Street, as supporters of the Democratic Party, naturally did not want to become his financial alchemists. Under this context, cryptocurrencies not only could provide a "financial backdoor" to avoid traditional regulation and bypass bank scrutiny, but they also became a handy weapon for establishing a family economic empire. By pushing family enterprises into the crypto industry, he aimed to create a "Trump financial empire" independent of the existing financial order.

Thus, it can be seen that Trump is not fond of cryptocurrencies, but rather of weapons that allow him to bypass regulation and expand his voter base; whether that weapon is cryptocurrency or AI, he does not care. But looking back at the crypto industry—does this emerging sector need Trump’s sugar-coated shell? The most troublesome issue ignored amid this apparent victory is the current innovation stagnation faced by cryptocurrencies.

Reflecting on the development of the crypto industry, each bull market has been accompanied by significant technological innovations. The 2013 bull market was triggered by Bitcoin's initial mainstream attention; the 2017 bull market was driven by Ethereum's smart contracts, inaugurating the ICO frenzy; the 2021 bull market brought about new application scenarios with DeFi (decentralized finance) and NFTs (non-fungible tokens).

However, by 2025, the crypto industry found itself in an innovation bottleneck. The mechanics of DeFi have been repetitively chewed, returns are dwindling while risks are increasing; the NFT market has yet to find true value support after experiencing a round of bubble burst; many sectors have been successively debunked, with the launch of tokens marking the beginning of project death.

In contrast, innovations in the AI field are flourishing. Companies like OpenAI, Google, and Anthropic are continuously launching astonishing new models, and AI applications are permeating various industries. From content creation to code generation, from medical diagnosis to financial analysis, AI is demonstrating enormous potential to change the world.

This comparison is brutal. In the battle for capital and talent, AI is comprehensively overpowering the crypto industry. In 2025, global venture investment in AI reached a historic high, while funding flowing into the crypto industry has continued to shrink. More and more developers are shifting from Web3 to AI, and an increasing number of investors are reallocating their funds from cryptocurrencies to AI stocks.

The Trump administration is also indifferent to this. Although Trump promised during the campaign to make the U.S. the "crypto capital," his administration has not introduced any substantive policies to nurture the crypto industry. There are no tax incentives, no R&D subsidies, no talent cultivation plans. In contrast, Trump has announced that SoftBank Group of Japan, the U.S. Open AI Research Center, and Oracle Corporation will invest $500 billion to build infrastructure supporting AI development in the U.S.

The innovation stagnation in the crypto industry, combined with the siphoning effect of AI, has plunged the entire sector into unprecedented difficulties in 2025. And Trump's tariff war has only stepped on that fragile foundation.

The Tariff War's "Fatal Blow," Market Crash and Collapse

If the controversy surrounding meme coins is a chronic poison, then the tariff war initiated by Trump is a heavy blow to the crypto market.

Trump's justification for initiating the trade war was "protecting American manufacturing" and "reducing the trade deficit," which have nothing to do with the crypto industry. However, the financial turmoil sparked by the trade war severely impacted the crypto market. Trump seems to care little—on his priority list, the interests of the crypto industry clearly rank after trade policy.

On February 1, 2025, Trump signed an executive order announcing an extra 10% tariff on all imported goods from China under the pretext of combating the flow of fentanyl. After negotiations did not meet expectations, Trump launched a comprehensive tariff escalation called "Liberation Day" in early April.

On April 2, Trump announced a 34% tariff on Chinese goods. Subsequently, within just a few days, in certain areas, the total tariff soared to 100% or more. China quickly announced retaliatory tariffs of the same proportion (34% and subsequently) on American products.

BTC also plummeted from $88,000 to $74,500, marking the lowest point in the first half of 2025.

The sensitivity of the crypto industry arises because when macro conditions deteriorate and risk assets are sold off, the crypto market often bears the brunt. Trump's tariff policy precisely created such a detrimental macro environment.

However, this tariff war was just the prelude; who could have predicted that on October 10, Trump would suddenly announce via social media that due to China's export restrictions on key minerals (rare earths), the U.S. would impose punitive tariffs of 100% to 130% on all imported goods from China.

After the news broke, global financial markets shuddered. The Dow Jones index opened down over a thousand points, while the Nasdaq index suffered even greater losses. Meanwhile, in the crypto market, panic was amplified exponentially.

On the evening of October 10, BTC continued to decline, dropping from $120,000 to $113,000, and by early morning on October 11, the market turned tumultuous, as BTC suddenly fell to $110,000, shortly dipping to $102,000. Under BTC's influence, ETH also dropped to $3,435, SOL briefly dipped to $168.79, SUI even plunged to $0.5597, and ATOM on Binance fell to $0.001. The on-chain Gas rate briefly soared to 450 Gwei. Backpack malfunctioned due to market fluctuations, and the Kraken exchange was temporarily inaccessible.

Even more horrific were those in the high-leverage derivatives market—according to Coinglass data, in that 24-hour period the total liquidations across the network amounted to $19.179 billion, a historic high. Among them, long positions were liquidated for $16.715 billion, affecting 1,633,245 people, with the largest single liquidation happening on Hyperliquid - ETH-USDT worth $203 million. By platform, Hyperliquid saw liquidations over $10.2 billion, Bybit over $4.6 billion, and Binance over $2.3 billion.

The servers of exchanges frequently crashed under the enormous traffic, making it impossible for many investors to close their positions in time; they could only watch helplessly as their holdings were forcibly liquidated. Social media was filled with desperate voices: Some lost their down payments for homes, some lost their children's tuition, and some even contemplated taking their own lives.

The chain reaction of this crash is profound. Many crypto projects were forced to shut down due to broken funding chains, layoffs swept through exchanges and the entire industry, and regulatory bodies began to reassess their lenient policies toward the crypto sector. Once-booming crypto conferences became deserted, and once-spirited crypto KOLs became silent or exited the scene.

The market officially entered a bear market from that moment.

And what about Trump? He said not a word about the crypto market's plight.

At this moment, the crypto industry finally recognized the reality: that the "crypto president" once held in high hopes was never their friend. Trump leveraged the crypto industry for political capital and used meme coins to extract wealth for his family, and that was all.

Over a hundred years ago, Yuan Shikai fell from "the savior of the Republic" to "the thief of the nation," delivering a heavy blow to China's modernization process. Today, Trump's term has yet to end, and no one knows whether he is the "crypto president" or the "industry manipulator."

However, true technological innovation will not die because of the betrayal of a political figure. Those crypto practitioners who have experienced all this understand that only technological advancement and value creation can serve as a true moat for an industry.