Crypto Market Crashes After Boom Following the 2024 Presidential Election

The cryptocurrency sector has experienced extraordinary upheaval since the U.S. presidential election on November 5, 2024. Although this political event initially triggered a spectacular market euphoria, that momentum has now been completely eroded, leaving investors in a state of deep concern. From the peak reached a few months ago, the market has fallen approximately 40%, bringing many digital assets back to much lower levels.

Dramatic Surge After the 2024 Presidential Election

The impact of the 2024 presidential election on the cryptocurrency market was very evident in the first few weeks afterward. Total3 Market Cap, an indicator measuring the market capitalization of all altcoins except Ethereum and Bitcoin, increased impressively by 91% after the election. In a short period, this metric reached $1.16 trillion in December 2024, significantly higher than the $600 billion before the election. This massive buying power reflected widespread optimism across the crypto ecosystem, with retail and institutional investors alike seeking to capitalize on the expected post-election profit momentum.

However, this impressive rally was not stable. The market then corrected to around $900 billion, with volatility continuing to fluctuate throughout the first quarter of 2025. On January 18, 2025, Total3 briefly rebounded to $1.13 trillion, just two days before Donald Trump’s inauguration. This phenomenon indicates that market sentiment remains heavily influenced by macro factors and expectations of new government policies.

Reaching a New Peak Before the Major Collapse

Entering 2025, the cryptocurrency market did not immediately enter a deep bear market. Instead, it experienced sideways fluctuations that lasted nearly the entire year, with investors still holding hope for more crypto-friendly regulations from the new administration. By October 2025, Total3 reached an all-time high of around $1.19 trillion, seemingly giving a second chance for market optimists to maximize gains.

However, this optimism was short-lived. A significant crash toward the end of October 2025 shattered the upward momentum that had lasted for months. Currently, Total3 has plummeted to $713 billion, a level not far from its position on November 10, 2024 (one month after the presidential election). This means all gains made from the 2024 election through October 2025 have been wiped out within weeks.

Bitcoin and Ethereum, the two largest assets in the industry, also fell victim to this downturn. Bitcoin has lost over 50% of its peak price, now trading around $67.27K, down from much higher highs. Ethereum experienced a similar fate, dropping about 60% from its peak near $5,000 in summer 2025, now at $2.03K. These deep wounds show that there is no safe haven from systemic selling pressure in a market that is deleveraging.

Investor Sentiment Reaches Its Lowest Point

The current psychological state of the market reflects unprecedented despair. The Fear and Greed Index, a barometer designed to measure market emotions in the cryptocurrency sector, is in the “extreme fear” zone with a reading of 14 according to CoinMarketCap data. This figure is one of the lowest on record, just slightly above the all-time low of 5 recorded on February 5.

This massive fear indicates profound uncertainty among investors about the long-term direction of the cryptocurrency sector. Many are questioning whether the market will recover to previous levels or undergo a fundamental restructuring. This uncertainty is compounded by external factors such as monetary policy, global regulation, and changing behaviors of institutional investors who are becoming increasingly cautious about taking risks. This scenario starkly contrasts with the euphoria felt immediately after the 2024 presidential election, when most of the market believed a new pro-crypto era had begun.