Decentralized finance (DeFi) tokens have experienced a notable surge, rising over 30% as traders anticipate a boost in the attractiveness of holding utility tokens under the Trump administration. Recent data indicates that prominent tokens such as Uniswap’s UNI saw significant gains, climbing more than 35% to reach a peak of $9.58. Other tokens, including Lido DAO (LDO), Ethena (ENA), AAVE, and Maker (MKR), also recorded increases exceeding 20% from their recent lows.
The recent surge can be attributed to a shift in perception regarding DeFi tokens, which have often been dismissed as mere governance tokens lacking intrinsic value. Investors are now optimistic that these protocols could eventually generate value for token holders through revenue generated from protocol fees. Concerns surrounding regulatory scrutiny, especially from agencies such as the Securities and Exchange Commission, have previously hindered the development of these value-accruing mechanisms.
The political landscape, particularly Donald Trump’s recent presidential victory, has fostered a sense of regulatory optimism within the market. Speculation suggests that this may influence a potential resignation of SEC Chair Gary Gensler, paving the way for a more accommodating regulatory environment for DeFi projects. Consequently, traders are entering positions in anticipation of these anticipated changes.
Specific proposals, such as Aave’s fee switch and the distribution of fees from Uniswap’s latest layer 2 initiative, signal a strategic shift toward establishing inherent value for token holders. Similarly, other DeFi protocols, including LIDO, ENA, MKR, and Frax, are expected to follow suit with similar adjustments.
In parallel, investment strategies are evolving, with some traders applying a “buy the laggard” approach, targeting previously underperforming assets that have the potential to recover. Amidst this bullish sentiment, Ether is currently trading at $2,845, reflecting an 8.5% increase over the past day, with predictions suggesting it could reach as high as $3,000 if it surpasses the resistance level of $2,700.
