As President-elect Donald Trump prepares to take office, the cryptocurrency industry is eagerly awaiting the execution of his promised overhaul of U.S. crypto policies. His team has indicated that the new administration aims to address key challenges facing the sector, including access to banking services, the creation of a national bitcoin stockpile, and the formation of a dedicated crypto council. This aggressive push for crypto reform comes as Trump’s team looks to fulfill his campaign pledge to be a “crypto president” by bringing digital assets into the mainstream.

The cryptocurrency industry’s anticipation of a major policy shift underscores the growing significance of digital currencies in the global economy. Trump’s first 100 days in office are seen as crucial, with industry insiders pushing for immediate executive orders on January 20, the day of his inauguration. These executive actions would lay the foundation for a more crypto-friendly regulatory environment in the U.S., signaling a sharp departure from the Biden administration’s more cautious stance on digital assets.

In contrast to the Biden administration, which has sought to regulate the industry more tightly due to concerns about crime and market volatility, Trump’s approach is aimed at reversing this trajectory and fostering innovation. His team has already taken steps to signal its commitment to crypto reform, including the appointment of crypto-friendly officials like Securities and Exchange Commission (SEC) Chair Paul Atkins and White House crypto czar David Sacks. This aligns with Trump’s broader economic agenda of championing American leadership in emerging industries, with cryptocurrency poised to be a key area of focus.

The idea of a national bitcoin stockpile, first mentioned by Trump in a July speech, has sparked significant debate within the crypto industry. With bitcoin’s value recently surpassing $107,000 before retreating to below $100,000, industry experts argue that the U.S. must secure a strategic reserve of bitcoin to stay competitive on the global stage. One such group, the Bitcoin Policy Institute, has even drafted a potential executive order for Trump that would require the U.S. Treasury to allocate $21 billion over the course of a year to amass a national bitcoin reserve. This move, the institute believes, would not only safeguard the U.S. against rising bitcoin prices but also position the nation as a leader in digital currency reserves, similar to traditional reserve assets like gold.

Despite the enthusiasm, some analysts caution that executive orders alone may not be enough to fully implement the envisioned reforms. Specifically, there is uncertainty over whether Trump can use executive powers to create a bitcoin reserve, or if an act of Congress will be required to authorize such a move. The issue of regulatory clarity remains contentious, especially regarding how U.S. financial institutions engage with the cryptocurrency sector. While Trump has promised to prevent banks from “choking” crypto firms out of the financial system, crypto companies have long struggled with access to banking services due to the complex regulatory environment. Some industry leaders expect that Trump’s administration will address this by pushing for greater flexibility from bank regulators, although it’s unclear whether this would result in immediate legal changes.

A central feature of Trump’s crypto agenda is the creation of a dedicated crypto council, a move that would institutionalize cryptocurrency policy within the U.S. government. Previous administrations have established similar councils to address specialized areas of public policy, and Trump’s team is reportedly exploring how to structure such a body to best support the needs of the crypto industry. This council could serve as a platform for industry stakeholders to collaborate with government officials and ensure that regulatory frameworks evolve in step with technological advancements in the sector.

The broader vision for crypto regulation under Trump involves rethinking the existing regulatory landscape, which many in the industry argue is ill-suited to the unique nature of digital assets. Trump’s executive orders could include directives to review and revise the regulatory rules governing crypto businesses, possibly mirroring the 2017 executive order he issued to reassess banking regulations. Industry advocates hope that this review would result in a more streamlined regulatory framework, one that supports innovation while still addressing concerns such as consumer protection and market integrity.

As the Trump administration prepares to take office, the crypto industry is watching closely to see how the promised overhaul will unfold. The potential for a national bitcoin stockpile, greater access to banking services, and a dedicated crypto council signals a new era of crypto regulation in the U.S., one that seeks to position the country at the forefront of the global digital economy. However, the success of these initiatives will depend on the ability of Trump’s team to navigate the complexities of crypto regulation and build consensus among industry stakeholders, regulators, and lawmakers.

While the potential for major changes is high, there remains uncertainty about the immediate impact of these executive actions. It is unclear whether the Trump administration’s push for crypto reform will lead to meaningful changes in the industry’s regulatory framework or whether the legal and political hurdles will slow down the implementation of these ambitious policies. Nonetheless, the crypto community remains hopeful that Trump’s administration will fulfill its promise to create a more favorable environment for digital assets, paving the way for a more robust and mainstream cryptocurrency market in the United States.

(Adapted from Reuters.com)

Categories: Economy & Finance, Regulations & Legal, Strategy