As President-elect Donald Trump prepares to assume office next month, the cryptocurrency industry is eagerly awaiting his promised crypto policy overhaul. Industry leaders are urging Trump to deliver on his campaign pledge of becoming a “crypto president” by issuing executive orders that would pave the way for cryptocurrencies to go mainstream. From creating a national bitcoin stockpile to ensuring fair access to banking services, the crypto sector has outlined its priorities for Trump’s first 100 days in office.
Executive Orders on Day One
President Trump has signaled his intent to issue a flurry of executive orders and directives immediately upon taking office on January 20. These orders will span a range of issues, including immigration and energy, but the cryptocurrency industry is optimistic that its proposals will be part of Trump’s initial actions.
During his campaign, Trump emphasized his support for cryptocurrencies, gaining backing from the crypto community. His team has been urged to prioritize policies that would:
- Establish a national bitcoin reserve.
- Ensure banking access for crypto companies.
- Create a crypto industry council to guide policy development.
Industry leaders believe that such measures would signal a strong commitment to advancing American leadership in cryptocurrency and blockchain innovation.
The Push for a Strategic Bitcoin Reserve
One of the most ambitious proposals is the creation of a strategic bitcoin reserve. Trump’s plans for such a reserve were first announced in a speech in July, sparking excitement and speculation within the industry. Bitcoin’s value surged to record highs of over $107,000 following Trump’s reiteration of this proposal, although it has since stabilized below $100,000.
The Bitcoin Policy Institute, a prominent industry group, has drafted a potential executive order that would designate bitcoin as a strategic reserve asset. The draft proposes that the Treasury Secretary allocate $21 billion over a year to amass a national bitcoin stockpile. Advocates argue that this would position the United States as a global leader in bitcoin monetization and provide a hedge against economic and geopolitical uncertainties.
Zack Shapiro, head of policy at the Bitcoin Policy Institute, emphasized the urgency of the proposal, stating, “The United States should get ahead of geopolitical rivals in monetizing bitcoin, rather than have the price run up without the United States having any reserves.” While the group has not disclosed whether the draft has been shared with Trump’s team, it reflects the industry’s determination to influence policy at the highest levels.
Addressing Banking Challenges
Another critical issue the crypto industry expects Trump to address is the long-standing challenge of banking access. Many crypto firms have struggled to establish relationships with traditional banks due to regulatory scrutiny. During his campaign, Trump pledged not to let banks “choke” crypto firms out of the financial system.
An executive order directing bank regulators to ease restrictions on crypto companies could send a strong signal to financial institutions. However, experts caution that such an order may not have immediate legal force since federal bank regulators operate independently. Jonah Crane, a partner at financial firm Klaros Group, noted, “They are not going to change policy on the ground on day one. But they will tell you what direction this administration wants to head.”
Despite these limitations, the industry views Trump’s stance as a step toward fostering a more inclusive financial ecosystem for cryptocurrencies.
Creation of a Crypto Industry Council
To ensure sustained engagement and collaboration between the government and the crypto sector, Trump has proposed the establishment of a crypto industry council. This council would serve as an advisory body, providing recommendations on policy, regulation, and innovation.
Industry leaders believe that a dedicated council could bridge the gap between regulators and the rapidly evolving crypto market. Previous administrations have successfully established similar councils through executive orders, offering a model for Trump’s team to follow.
Regulatory Overhaul and Core Principles
The crypto industry has long criticized existing regulations as being ill-suited to the unique characteristics of digital assets. Trump’s team is reportedly considering an executive order that would articulate core principles for crypto regulation, directing federal agencies to re-examine their rules in this space.
Such an order could resemble Trump’s 2017 directive for banking rule reviews. By outlining a clear vision for crypto regulation, the administration could provide much-needed clarity and consistency for industry participants. Rebecca Rettig, chief legal and policy officer at Polygon Labs, highlighted the importance of this approach, stating, “It would be imperative for executive orders to really set out what the actual priorities will be on day one and provide some kind of roadmap.”
Challenges and Criticisms
While the industry is optimistic about Trump’s crypto-friendly stance, challenges remain. Critics argue that his proposals may face legal and practical obstacles. For example, creating a strategic bitcoin reserve may require congressional approval, raising questions about the feasibility of implementing such a measure through executive action alone.
Additionally, regulatory agencies like the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) operate with a degree of independence, potentially limiting the immediate impact of executive orders.
The Biden administration’s crackdown on crypto companies has also left a legacy of heightened scrutiny that may not be easily reversed. Trump’s team will need to navigate this complex regulatory landscape while balancing the interests of investors, businesses, and policymakers.
The Role of Key Appointments
Trump’s commitment to advancing crypto innovation is reflected in his key appointments. Crypto-friendly figures like Paul Atkins, the incoming SEC chair, and David Sacks, the White House crypto czar, are expected to play pivotal roles in shaping policy.
These appointments signal a departure from the Biden administration’s approach and underscore Trump’s intention to prioritize crypto as a cornerstone of his economic agenda. Brian Hughes, a spokesperson for Trump’s transition team, stated, “There has been an effort in the Washington bureaucratic swamp to stifle innovation… but President Trump will deliver on his promise to encourage American leadership in crypto.”
Implications for the Crypto Market
The prospect of a pro-crypto administration has already impacted the market. Bitcoin’s recent surge to over $107,000 highlights the potential influence of policy announcements on investor sentiment. Analysts predict that Trump’s actions could further fuel adoption and innovation in the sector.
However, the market’s volatility underscores the need for thoughtful and measured policy implementation. While executive orders can provide a framework for progress, long-term stability will depend on collaborative efforts between the government and industry stakeholders.
Conclusion
As Donald Trump prepares to take office, the cryptocurrency industry is poised for a potential policy revolution. From creating a strategic bitcoin reserve to addressing banking challenges and establishing a crypto council, Trump’s proposals have generated significant excitement and anticipation.
While challenges remain, his administration’s pro-crypto stance represents a unique opportunity to position the United States as a global leader in digital assets. The coming months will be critical in determining whether Trump can deliver on his promises and reshape the future of cryptocurrency regulation.
By fostering innovation, ensuring fair access to financial services, and providing regulatory clarity, Trump’s crypto policy could lay the groundwork for a thriving and sustainable digital economy. Whether these efforts will succeed in overcoming existing barriers and addressing the industry’s concerns remains to be seen, but the potential for transformation is undeniable.
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