Cryptocurrency markets have been on a tear, with the CoinDesk 20 index leaping 5.3% over the past day, fueled by new U.S. policy directions. President Donald Trump recently signed an executive order that opens 401(k) retirement plans to a wider array of investments, notably cryptocurrencies. This landmark decision is seen as a potential game-changer in the world of retirement investing—one that could funnel substantial capital into the crypto sphere. For more details on the implications of this move, see Trump Set to Greenlight Crypto in 401(k)s; Bitcoin Rallies on Retirement Reform Push.
401(k) Shake-Up: A Boon for Crypto?
Trump’s executive order instructs both the Department of Labor and the Securities and Exchange Commission to roll out new guidelines for retirement accounts. This opens the door to digital assets like Bitcoin and Ethereum, which were previously shunned by fiduciaries due to regulatory ambiguity. “The move effectively unlocks access to nearly $8.7 trillion in assets under management,” said James Butterfill, head of research at CoinShares, in a statement.
Jake Ostrovskis, an OTC trader at Wintermute, noted that even a modest 2% allocation to cryptocurrencies could dwarf the total cumulative ETF inflows to date. “These are largely price-insensitive buyers, focusing on meeting allocation benchmarks rather than tactical trading,” Ostrovskis explained. Such demand could offer a consistent, structural bid for digital assets, smoothing out volatility, and providing a robust support level.
Ethereum’s Ascendancy and Broader Market Context
While Bitcoin’s price saw a modest 1.3% uptick to $116,500, Ethereum (ETH) surged 4.6% to nearly $3,900. This came as the Ethereum blockchain set a new record for average daily transactions, driven by the SEC’s recent clarification that certain liquid staking models are not considered securities under the 1933 Securities Act. This regulatory clarity has emboldened institutional players to dive into staking services, adding to the growing demand for ETH.
Over 36 million ETH—almost 30% of the total supply—is now locked in staking contracts, according to Dune Analytics. “Public companies now control $11.77 billion in ETH,” noted Vitalik Buterin, the co-founder of Ethereum. However, he warned that excessive leverage could lead to cascading liquidations, a risk that crypto veterans are well aware of.
Traditional Markets and Emerging Signals
While crypto markets were buoyant, traditional finance (TradFi) showed mixed signals. The S&P 500 dipped slightly, and the Nasdaq gained a modest 0.35%. Gold, on the other hand, rose on new tariffs, indicating a jittery market ahead of July’s inflation report—data that will be closely watched for clues on a potential dovish Federal Reserve interest rate cut in September.
Elsewhere, geopolitical events are unfolding that could have ripple effects on global markets. President Trump is pushing for a peace deal between Armenia and Azerbaijan, with economic agreements to follow—a move that, if successful, could promote regional trade and stability.
Looking Ahead: Opportunities and Risks
The crypto market is poised for significant shifts. The upcoming FTX distribution on August 15 and Coinbase’s launch of nano SOL and nano XRP futures on August 18 are events to watch. Meanwhile, Ethereum NYC and other conferences are set to drive dialogue and innovation in the sector. For a deeper dive into how Bitcoin is responding to these developments, see Bitcoin Nears $117,000 Ahead of Trump’s Plan To Open 401(k)s to Crypto.
Yet, questions remain. Can the rally sustain itself in the face of potential regulatory hurdles and macroeconomic uncertainties? The introduction of crypto into 401(k) plans could be a double-edged sword—bringing both opportunities and challenges. As the crypto landscape evolves, investors and observers alike will be keeping their eyes peeled for the next big move.
Source
This article is based on: Market Rallies as Trump Opens 401(k) Floodgates: Crypto Daybook Americas
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Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
