Bitcoin climbed on Friday, continuing its recovery from a sharp price drop over the New Year holiday as traders sought clarity on U.S. regulatory policies under incoming President Donald Trump.
Tether (USDT) remained a focal point this week, suffering its steepest market capitalization decline since the 2022 FTX collapse. This drop followed the European Union’s Markets in Crypto-Assets (MiCA) law coming into effect in late December. Compliance concerns prompted several European exchanges and Coinbase Global Inc. (NASDAQ:COIN) to delist the stablecoin.
The broader crypto market faced a sell-off in the final week of 2024, driven by profit-taking after a strong annual performance. However, caution emerged due to expectations that U.S. interest rates might decline more slowly in 2025.
Despite these challenges, optimism about potentially friendlier regulations under Trump helped buoy sentiment, with Bitcoin rebounding from its year-end lows.
Bitcoin rose 1.2% to $96,852.7 by 23:41 ET (04:41 GMT), briefly surpassing the $97,000 mark earlier in the day.
Tether Impacted by MiCA Implementation
Tether’s market capitalization fell 1.4% over the past week to around $137 billion, primarily due to the MiCA law’s implementation.
The new regulations impose stringent requirements on stablecoin issuers within the EU, including mandates for capital reserves, liquidity, and licensing to operate in the bloc. As the largest dollar-pegged stablecoin, Tether plays a crucial role in facilitating crypto transactions, which could limit the broader impact of MiCA on its market dominance.
Crypto Prices Today: Altcoins Continue Recovery
Broader cryptocurrency markets extended their recovery on Friday, with most major altcoins posting gains after a slow start to the year.
Despite year-end losses, major altcoins recorded significant gains in 2024 as investors anticipated that pro-crypto policies under Trump could attract more capital to cryptocurrencies beyond Bitcoin.
Ethereum, the world’s second-largest cryptocurrency, rose 1.1% to $3,454.56, while XRP gained 1.6% to $2.4405. Solana, Cardano, and Polygon advanced between 0.4% and 2%. Among meme tokens, Dogecoin saw a 2.1% increase.
