Since the results of the presidential election on Nov. 5, the cryptocurrency market has soared by more than 40%. This enthusiasm is driven by Donald Trump's stance as a pro-crypto candidate, which has stirred optimism for a new era of digital asset growth. The overall belief is that a pro-crypto administration could lead to friendlier regulations, a more welcoming environment for crypto development, and even the possibility of the U.S. government adding Bitcoin (BTC 0.28%) to its reserves.
This shift has created major tailwinds for the cryptocurrency market, setting the stage for its next leg up. For those looking to capitalize on this opportunity, here are five cryptocurrencies to consider adding to your portfolio.
1. Bitcoin
First on the list is Bitcoin, the original and most established cryptocurrency. As a pioneer in the market, Bitcoin has secured its reputation as a digital gold, offering a store of value that's widely recognized and accepted. Under Trump's presidency, Bitcoin stands to benefit from multiple catalysts, such as increased adoption and a focus on domestic Bitcoin mining.
However, the most apparent and noteworthy tailwind is the prospect that clearer regulations hold the promise of bringing more institutional investors into the market, increasing demand, and bolstering Bitcoin's price. This trend was already beginning to pick up momentum before the election but is accelerating, as evidenced by the surge in inflows among spot Bitcoin exchange-traded funds (ETFs).
Additionally, and admittedly a long shot, Trump and several of his supporters have floated the idea of the U.S. government stockpiling Bitcoin. While still extremely speculative, if it were to be announced, it would create significant buying pressure and set a precedent that could lead to a Bitcoin arms race among nations.
To put it simply, for those looking to take advantage of the current market sentiment, Bitcoin remains the safest and most proven asset in crypto.
2. Ethereum
Ethereum (ETH 0.23%), the second-largest cryptocurrency by market cap, has also emerged as a top candidate to benefit under Trump's administration. As the backbone of the decentralized finance (DeFi) economy, Ethereum could thrive with the introduction of favorable regulatory clarity, which would encourage more investment in decentralized finance.
Moreover, clearer regulations would allow more institutional capital to flow into the sector, where much of the value is built on Ethereum's blockchain. Major players in traditional finance, such as BlackRock (BLK -0.96%) and UBS (UBS 0.16%), are already leveraging Ethereum to offer tokenized assets, demonstrating their confidence in the blockchain's reliability and scalability. With these developments, Ethereum's potential for long-term growth and adoption remains one of the most compelling.
3. Solana
Solana (SOL 2.47%) is another major cryptocurrency that is worth a close look in this bullish environment. Solana has shown impressive growth in nearly every metric, including daily active users, transaction volume, and developer activity, positioning it as a leader in this crypto bull cycle.
While a significant portion of Solana's usage comes from meme coin traders, meaningful innovation and real utility are being developed on the network.
With its high speed and low fees, Solana is an attractive choice for real-world applications. For instance, Render (RENDER -0.09%), a decentralized GPU rendering network, utilizes Solana's efficiency to process complex graphics tasks for applications in gaming, film, and design. Similarly, Helium (HNT 3.97%), a decentralized wireless network that allows users to earn rewards by providing internet coverage, also calls Solana home.
Although it is trading at near an all-time high, Solana's strong growth and solid infrastructure suggest it has plenty of room to maintain momentum in the current market cycle.
4. Aave
Aave (AAVE 1.17%) is one of the leading DeFi protocols, providing a platform where users can lend and borrow digital assets in a decentralized fashion. By letting users earn interest on their crypto holdings or borrow against them, Aave essentially acts as a bank on the blockchain. The project has launched across multiple blockchains, helping it attract a diverse user base while remaining at the forefront of DeFi innovation.
There are also discussions around enabling a so-called fee switch on Aave, which would distribute part of the platform's revenue to AAVE token holders. While not yet implemented, this proposal has been approved and would give token holders exposure to one of the most productive protocols in all of crypto.
5. Aerodrome
Last on the list is Aerodrome (AERO -1.64%). As one of the rising stars on Base, the blockchain developed by Coinbase Global (COIN -3.17%), Aerodrome has quickly become one of the most productive and widely used protocols.
Aerodrome's popularity stems from a combination of its home on Base, one of the most widely used blockchains, and its innovative design that attracts and retains liquidity while rewarding users. As a result, several key metrics, including trading volume, user activity, and revenue generation, all rank near the top of the market.
Even better, though, Aerodrome is entering a deflationary phase, which should bolster its price. Initially, the protocol was highly inflationary, issuing new tokens at a high rate to encourage participation and adoption. However, the emission rate of its tokens is set to decline, which could increase scarcity and, consequently, its token's value.
