Donald Trump’s election in November 2024 triggered a cryptocurrency bull run, fueled by his reputation as a pro-crypto leader.
His campaign promises, including the establishment of a strategic Bitcoin reserve for the U.S. and the launch of his own meme coin on January 17, added to the optimism. However, Trump’s inaugural address and initial executive orders made no mention of cryptocurrency, leaving investors guessing about his specific policies. Despite this, market enthusiasm has remained strong, with both retail and institutional players driving the rally.
Institutional interest, often more conservative, has shown surprising alignment with the ongoing excitement. A recent Securities and Exchange Commission (SEC) filing on January 21 revealed plans by REX Shares and Osprey Funds to launch seven new cryptocurrency exchange-traded funds (ETFs). Among these, two ETFs stand out as unprecedented in the market: ones based on Dogecoin (DOGE) and Trump’s meme coin (TRUMP).
In addition to the meme coin ETFs, the filing outlined plans for Bitcoin, Ethereum (ETH), Solana (SOL), and XRP ETFs. According to analyst James Seyffart, these funds will be filed under the 1940 Act, similar to crypto futures ETFs. This structure allows the ETFs to include a mix of derivatives and direct asset holdings, managed through a Cayman Islands-based subsidiary.
While the introduction of meme coin ETFs is a first for the market, questions remain about how these funds will manage the extreme volatility associated with meme-based assets. Large-cap cryptocurrency ETFs have historically attracted significant inflows, but whether these new offerings can capture similar interest—or fit within the risk tolerance of most investors—remains to be seen.
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