Following the Republican victory in the U.S. election, Standard Chartered suggests the new administration could lead to favorable crypto policies that may drive the market cap to $10 trillion by 2026. With Bitcoin already reaching record highs and Tether minting fresh liquidity, the outlook for digital assets has never been more promising. Here’s a look at the projected impacts of a Republican-led regulatory environment on Bitcoin, Ethereum, and other top cryptocurrencies.

Crypto Market Forecast: $10 Trillion Within Reach

Standard Chartered’s latest report highlights how the Republican win could usher in a period of regulatory clarity and support, potentially quadrupling the market cap from its current $2.5 trillion to $10 trillion. With a pro-business stance and focus on innovation, the administration is expected to create a supportive environment that could make the U.S. a global leader in crypto regulation.

Geoff Kendrick, head of digital assets research at Standard Chartered, remarked, “The rising tide should lift all digital assets,” indicating that digital assets with practical use cases are positioned to benefit the most from this growth.

Could a National Bitcoin Reserve Become Reality?

The report also raises the possibility of a U.S. Bitcoin reserve, an event with the potential for major impact. While Standard Chartered sees this as unlikely, the concept reflects the strategic importance of Bitcoin. The bank’s projections remain strong, with Bitcoin expected to reach $200,000 and Ethereum $10,000 by 2025, while Solana is projected to outperform due to its scalability and efficiency.

Kendrick anticipates a favorable period, stating, “With a Republican-led administration, we believe we have entered the crypto summer,” suggesting bullish growth and expanding adoption.

Bitcoin’s Record Surge Fueled by Market Liquidity

In the wake of the election, Bitcoin soared to a record high of $89,500, pushing the total crypto market cap to $2.7 trillion. This rally has been powered by recent Tether minting, which has injected significant liquidity and fueled buying demand across exchanges.

This fresh liquidity aligns with Standard Chartered’s projections, positioning BTC well on its path toward $200,000 by 2025.

Spot vs. Leverage: What’s Driving Bitcoin’s Rally?

According to Glassnode, Bitcoin’s recent surge has been largely driven by spot buying rather than leverage, especially on platforms like Coinbase, popular among U.S. investors. Spikes in the Coinbase Premium Index indicate rising spot demand among American buyers, reinforcing optimism in the market.

Historically, spot purchases on Coinbase have coincided with local highs or lows. For example, in March, Bitcoin hit record highs above $73,000 during a period of elevated spot buying.

ETF Inflows: Basis Trade or True Demand?

Spot Bitcoin ETFs have also seen substantial inflows, though some analysts debate whether these reflect genuine demand or are part of basis trading strategies. However, the inflows outpacing CME open interest growth suggest strong spot demand, reinforcing the view that there’s sustained buying interest.