Illusion and Reality: How Trump’s Political Promises Crashed Against the Wall of Economic Cycles | Bureau of Global Monitoring

Illusion and Reality: How Trump’s Political Promises Crashed into the Wall of Economic Cycles

Picture a scene from a good old blockbuster. The hero is a crypto investor. The year is January 2025. The setting is the inauguration. Donald Trump, hand on the Bible, swears to restore America’s former greatness. And somewhere in the background — on Twitter and Telegram channels — an unofficial but no less solemn anthem is playing: the era of regulatory persecution is over. Crypto has been given the green light. “America First” now also means “Crypto First”.

In our hero’s mind, images from 2021 start to form again, only this time in higher resolution: a bull market, champagne, altcoins with three zeros, meme coins that change lives.

The frame freezes. The music cuts out. A jump one year forward.

In front of our investor is not a chart with a rocket heading for the Moon. In front of him is a dry, merciless table. This is not an apocalypse. No zeros, no mass bankruptcies, no bans. It is something far more mundane — and therefore far more sobering. A classic textbook example of how political narratives crash head‑on into the iron laws of economic cycles, with the bill ultimately paid by the retail investor.

Let’s break this picture down. Calmly. With irony. And having completely wiped away the rose‑tinted glasses of 2025 optimism.

Dissecting the “Political Promises”: What Was Sold and What Was Bought

To understand the scale of the disappointment, we need to recall the narrative that dominated a year earlier.

Deregulation as a panacea. The logic was simple and appealing. The SEC under Gensler was portrayed as the main enemy of innovation. Trump, who openly criticized it, would come to power, replace the leadership, roll back lawsuits (first and foremost against Ripple), and establish clear, soft rules of the game. This, it was expected, would open the floodgates for institutional capital that had previously feared regulatory uncertainty.

Legitimization as a growth driver. The mere fact that the most influential person on the planet publicly supported cryptocurrencies was supposed to become a powerful signal for the mainstream audience and corporations. Crypto would move from an underground asset into a mainstream financial instrument.

“America First” for blockchain. The expectation was that policy would aim to retain and attract crypto innovation and capital within the US, rather than pushing it toward more friendly jurisdictions such as the UAE or Singapore.

Investors bought into this beautifully packaged political narrative. They did not just buy tokens — they bought a story about a bright future that was supposedly just around the corner, triggered by a politician’s hand gesture. A market already exhausted by a bearish phase eagerly embraced the idea of a new supercycle.

Collision with Reality: Macroeconomics, Liquidity, and Tokenomics

While politicians were delivering speeches, the world was operating under different, immutable laws. Politics creates expectations, but monetary cycles dictate reality.

1. High Fed Rates and “Expensive Money”.
   The key factor that overshadowed all political promises. By January 2025, the Federal Reserve, still fighting residual inflation, was holding the base rate at 5.25–5.50%. Money was expensive. Extremely so. In such an environment, investors globally rethink their portfolios.

— Flight from risk. Why invest in high‑risk assets with uncertain returns when you can earn a guaranteed 5%+ on Treasury bills?
— Repricing the future. Cryptocurrencies, especially altcoins, are a bet on a distant future. When the cost of money is high, that future is heavily discounted. Its present value collapses. Projects without meaningful current cash flow (that is, almost all of them) become far less attractive.

2. Liquidity Drain and the End of “Easy Money”.
   For several years, markets lived off the liquidity poured in by governments and central banks during the pandemic. By 2025, that effect had fully faded. QT (quantitative tightening), the Fed’s balance‑sheet runoff, was sucking liquidity out of the financial system. The very “fuel” that powered previous rallies was gone. Trump’s policies could not instantly print trillions of new dollars.
3. The Brutal Reality of Fully Diluted Valuation (FDV) and Unlocks.
   This was perhaps the most painful lesson for retail investors. Let’s look at our “heroes”.

Aptos (APT): −82%. A textbook case. A beautiful story (developers from Meta/Diem), a gigantic valuation (FDV in the tens of billions at launch). But what is FDV? It is the value of all tokens, including those not yet in circulation. In 2025, millions of APT tokens locked for the team, investors, and the foundation flooded the market. Supply surged, while demand — in an environment of expensive money — could not keep up. The market had priced the project not on current utility, but on speculative expectations.

Celestia (TIA): −91%. History repeated itself. A modular blockchain, hype, massive capitalization — followed by a wave of unlocks. Investors who received tokens at just a few cents (venture rounds, airdrops) took profits. And who were they selling to? Those who believed in the political narrative and bought the top.

Sui (SUI): −70%, Avalanche (AVAX): −69%. The same song again: big promises, strong teams, venture backing — and colossal selling pressure from early insiders once vesting periods expired.

4. Narrative Fatigue and the Absence of Real Demand.

Solana (SOL): −53%. Even the “Ethereum killer” with real activity and working applications could not hold up. The narrative of a “faster and cheaper Ethereum” stopped feeling fresh. When overall liquidity leaves the system, all boats sink — even the most technologically advanced ones.

Chainlink (LINK): −54%. A project with real revenues and partnerships outside the crypto sphere. Its decline was a clear signal that the market was not just deflating “bubbles”, but repricing the entire crypto sector relative to a new macro reality.

XRP: −39%. Notably, it fell less than the others despite the conclusion of the SEC lawsuit. Why? Because the positive news — regulatory clarity — had already been priced in during 2023–2024. The victory itself did not generate a new, powerful inflow of capital in an environment of broad macro restraint.

5. Meme Coins: A Billion‑Dollar Lesson.

Official Trump (meme coin): −90%.

The jewel of the collection. A perfect illustration of the thesis. If even a token bearing the name of the sitting president collapses by 90%, what does that tell us? That no name and no political fan club can replace an economic model. Meme coins are pure speculation driven by liquidity and sentiment. When liquidity dried up and the mood flipped to “risk‑off”, they were the first — and the hardest — to fall. A devastating argument against the logic of “buy what Trump supports”.

The Main Conclusion: Two Layers of Reality

The result of 2025 was not the death of crypto. It was the death of illusions.

1. The narrative layer (politics, hype, stories). It creates noise, shapes expectations, and inflates temporary bubbles. Media outlets and speculators feed on it.
2. The capital layer (liquidity, rates, tokenomics). It determines the real long‑term value of assets. Central banks and the laws of economics govern it.

All of 2025 made one thing painfully clear: when these two layers diverge, the second one always wins. Trump’s policies could (and perhaps partially did) improve the regulatory climate. But they were powerless against the Fed’s monetary policy, against the global cycle of expensive money, and against the math of token unlocks.

P.S. A Lesson for the Next Cycle

If, looking at this table, your hands are still itching to “buy the dip”, ask yourself two questions:

1. Has the macroeconomic environment fundamentally changed? Has money become cheap and abundant again?
2. Have the major token unlocks for these projects already passed, or is the main supply pressure still ahead?

If you cannot confidently answer “yes” to both questions, your desire is not a strategy. It is either gambling or faith in a miracle. The market of 2025 ruthlessly wiped out those who confused political slogans with investment theses. It delivered a harsh but valuable lesson: first study unlock schedules and the Fed’s balance sheet — and only then listen to campaign promises.

The next bull cycle will inevitably come. But its fuel will not be tweets — it will be real liquidity. And its leaders will not be those with the loudest names, but those with real users, revenues, and sustainable economic models in a world of expensive money. Everything else is just a beautiful picture from the past.

Global Monitoring Bureau | January 2026