Trump Appoints Musk to Head "Department of Government Efficiency," Dogecoin and Peanut the Squirrel Surge, Cryptomarket Rejoices

Trump Appoints Musk to Head "Department of Government Efficiency," Dogecoin and Peanut the Squirrel Surge, Cryptomarket RejoicesOn November 12, Trump announced that Elon Musk would lead the proposed "Department of Government Efficiency" (DOGE), directly using the term "DOGE" in his statement. This once again put Dogecoin in the spotlight

Trump Appoints Musk to Head "Department of Government Efficiency," Dogecoin and Peanut the Squirrel Surge, Cryptomarket Rejoices

On November 12, Trump announced that Elon Musk would lead the proposed "Department of Government Efficiency" (DOGE), directly using the term "DOGE" in his statement. This once again put Dogecoin in the spotlight. DOGE is the ticker symbol for Dogecoin, and since the announcement, Dogecoin has surged, rising by 19% at the time of publication. Meanwhile, possibly influenced by Musk's statement that "America is being saved by a squirrel and meme coins," the meme coin Peanut the Squirrel (PNUT), which features a squirrel as its mascot, experienced a short-term rapid surge, with its 24-hour gains expanding to 88.9%.

Although no substantial measures have been taken, since Trump's election victory, the cryptomarket has experienced several periods of exuberance. Since the US election day, Dogecoin's price has surged 153%, Bitcoin has risen by 30% in the same period, and Trump-themed coins and PNUT have also experienced substantial gains. Relevant analysts point out that the meme coin market is highly emotional, particularly for meme coins lacking practical use cases, with prices often being more susceptible to celebrity pronouncements or unexpected events. Traders should stay updated on market developments and implement appropriate risk management measures to navigate potential market volatility.

The following will elaborate on the impact of Trump appointing Musk to head the "Department of Government Efficiency" on the cryptomarket, as well as the emotional characteristics and potential risks of the meme coin market.

Meme Coin Sector Surges

On November 12, Trump announced that Musk and American entrepreneur Vivek Ramaswamy would lead the proposed "Department of Government Efficiency." As the abbreviation for this department and the nickname for the cryptocurrency Dogecoin are both "DOGE," and Musk has repeatedly "endorsed" Dogecoin, following this appointment announcement, Dogecoin continued to climb, rising over 19%, even as the broader cryptomarket experienced a correction. Since the US election day, Dogecoin's price has risen 153%. This week, Dogecoin even surpassed Ripple to become the sixth-largest cryptocurrency by market capitalization.

Trump stated that the "Department of Government Efficiency" would "pave the way for dismantling government bureaucracy, cutting excessive regulations and wasted spending, and restructuring federal agencies." Musk subsequently retweeted Trump's statement on the social media platform X. Later, facing users who questioned the "necessity of a US government efficiency department," Musk responded, "America is being saved by a squirrel and meme coins." Possibly influenced by this news, the meme coin PNUT, featuring a squirrel as its mascot, experienced a short-term rapid surge, with its 24-hour gains expanding to 99.84%, and its market capitalization exceeding $800 million. Moreover, Musk posted an image featuring a Shiba Inu dog and the words "DOGE" (Department of Government Efficiency) and responded to users with "Making Government Fun Again."

According to SoSoValue data, on the morning of November 13, the overall cryptomarket experienced a slight correction. However, Trump-themed coins still rose by 40.40%, and the meme coin sector gained 3.39%.

"Although the 'Department of Government Efficiency' has no direct connection to the cryptomarket, the significant surge in Dogecoin and PNUT demonstrates the highly emotional nature of the meme coin market," Zhao Wei, senior researcher at OKX Research Institute, told the China Business Times. He further stated that in the cryptomarket, the meme coin sector generally has higher speculation and volatility, and these news-driven short-term surges can quickly decline after market sentiment subsides. Investors should be cautious and avoid potential losses by relying excessively on news items.

Multiple Nominated Officials Hold "Crypto-Friendly" Attitudes

On November 12, Trump nominated several key officials for his presidency. The reporter noticed that besides Musk, several others also hold "crypto-friendly" attitudes.

Trump nominated Pete Hegseth, who has hosted shows on Fox News for eight years, to be the US Secretary of Defense. He previously stated that he believed in the decentralized value of Bitcoin and promised not to sell his Bitcoin holdings.

Meanwhile, according to media reports, Scott Bessent, Trump's economic advisor, is looking for candidates to serve as his deputy, potentially signaling that the hedge fund manager is preparing to become the Treasury Secretary in the new administration. Scott is a strong advocate for cryptocurrencies, particularly Bitcoin. He recently stated, "The president's support for cryptocurrencies excites me; I think it aligns very well with the Republican Party. Cryptocurrencies represent freedom, and the crypto economy will continue to exist."

"I think all the possibilities of Bitcoin are worth exploring. One of the most exciting things about Bitcoin is that it's attracting young people and people who have never participated in the market before. Fostering a market culture in America where people believe there is a system that works for them is at the heart of capitalism."

Furthermore, during his campaign, Trump pledged that if he was re-elected, he would dismiss SEC Chairman Gary Gensler, who has implemented strict regulations on the cryptocurrency industry, "on day one." Recently, Trump hinted on social media that he would bypass the Senate appointment confirmation process to appoint members of his government. The market believes this seems to include replacing the Chairman of the Securities and Exchange Commission (SEC).

Marion Laboure, a research analyst at Deutsche Bank, stated that under President-elect Trump's leadership, cryptocurrencies would benefit from a more favorable regulatory and political environment, but future policy uncertainties remain. In a report, she stated that the incoming Trump administration could accelerate regulatory transparency, strengthen institutional involvement, improve market infrastructure, and achieve broader mainstream adoption. However, policy uncertainty is still a key factor driving price increases.

Laboure stated, "It is important to emphasize that if the Trump administration's expected regulatory reforms of the cryptocurrency industry fall short of market expectations, we could see potential volatility."

"While the current dynamics of Trump and US politics are a significant indicator for the cryptomarket, investors need to remain rational and focus more on actual cryptocurrency policy measures." Zhao Wei also reminded.

Geoff Kendrick, head of global digital asset research at Standard Chartered Bank, believes that favorable policies will boost the overall cryptocurrency market capitalization to around $10 trillion by the end of 2026, from its current value of $2.7 trillion.

Emotional Characteristics and Potential Risks of the Meme Coin Market

The meme coin market, especially those lacking practical use cases, is often strongly influenced by market sentiment and celebrity effects. For example, the surge in Dogecoin and PNUT is largely attributed to Musk's statements and Trump's appointment of the "Department of Government Efficiency."

However, this emotional volatility also means that meme coin prices are highly susceptible to market sentiment decline or negative news and could rapidly decline. Therefore, investors should carefully monitor market developments and implement risk management measures when investing in meme coins to avoid losses caused by excessive reliance on news or blindly chasing price rallies.

Conclusion

Trump's appointment of Musk to head the "Department of Government Efficiency" has sparked a wave of exuberance in the cryptomarket, particularly in the meme coin sector. However, investors need to remain rational, recognizing the volatility and potential risks of the meme coin market, approaching investments cautiously, and focusing on actual cryptocurrency policy measures.

Here is some additional information about the meme coin market:

• Definition of meme coins: Meme coins are cryptocurrencies typically based on internet culture or popular events, often lacking practical utility, and their value is primarily driven by community and market sentiment.

• Risks of meme coins: As meme coins often lack practical use cases, their prices are highly volatile and susceptible to market sentiment and news events. Investors should be aware of the potential risks of meme coins and implement appropriate risk management.

• Investment advice for meme coins: Investors should conduct thorough research, understanding the project background, development team, technology, and community of meme coins, and make investment decisions based on their own risk tolerance.

Disclaimer: This article is for informational purposes only and should not be considered investment advice. Investors should conduct independent research and make investment decisions based on their own circumstances.