On Thursday, Trump seemed to fulfill his campaign promise of being a “crypto president” by declaring that he would appoint former top PayPal executive and crypto supporter David Sacks as “White House A.I. & Crypto Czar.” The day before, Trump announced his intention to nominate pro-crypto attorney Paul Atkins as the head of the Securities and Exchange Commission.
While crypto leaders celebrated the announcement, believing the duo would put an end to the Biden administration’s crackdown on crypto and foster innovation, some analysts in Washington raised concerns that the establishment of a crypto czar could create confusion about who would dictate crypto policy and could lead to policy conflicts.
“A key question is whether Sacks will be the one shaping the policy. A czar appointed by Trump is likely to want swift changes, but the SEC follows established processes, and you can’t just wish new regulations into existence,” Ian Katz, managing director of Capital Alpha Partners, wrote in an email to Reuters. “The personalities involved will matter,” he further stated.
Sacks, a venture capitalist from Silicon Valley and an associate of Trump’s billionaire supporter Elon Musk, is known to have invested early in bitcoin. In a CNBC interview from 2017, he remarked that cryptocurrencies were transforming the internet, while also recognizing the presence of scammers in the space. According to a Reuters review of his history, he does not seem to have any background in policy formulation or leadership.
On the other hand, Atkins is a previous SEC official and a well-respected figure in Washington policy circles, who has expressed his support for crypto innovation as a means to enhance competition in financial services, and he has aided crypto firms in dealing with regulators through his consultancy, Patomak Global Partners.
“Atkins is quite a known entity,” commented Lene Powell, senior legal analyst at financial consultancy Wolters Kluwer. Sacks, however, comes from “a different background.” Both individuals have urged regulators to adopt a more supportive stance towards cryptocurrency companies, yet neither has taken a definitive stand on whether and when crypto tokens should be classified as securities, commodities, or utilities—a pivotal issue for the industry’s regulation.
“I anticipate we will see more constructive regulations. Naturally, that will involve clarifying what constitutes (a) security or not,” remarked Chen Arad, co-founder of Solidus Labs, a crypto compliance firm. Neither Atkins nor Sacks responded promptly to requests for comment.
After Trump announced Atkins as his choice to lead the SEC, Bitcoin, the largest cryptocurrency worldwide, surged above the $100,000 mark for the first time, driven by optimism that the new administration would bring about more lenient policies toward crypto.
Under President Joe Biden, the SEC has taken legal action against numerous crypto companies for allegedly violating securities laws, while banking regulators have discouraged banks from engaging with crypto, and Congress has failed to advance legislation that would foster mainstream crypto adoption.
The crypto sector is advocating for an ambitious array of policies designed to enhance the acceptance of digital assets, including the establishment of a regulatory framework that would clarify when tokens can be deemed securities or commodities.
Trump stated in a Thursday post on his Truth Social platform that Sacks would “guide” crypto policy and “work on a legal framework to provide clarity” for the crypto industry, leaving it ambiguous whether Sacks would be at the helm of the administration’s crypto policy.
It was also not specified if Sacks would lead Trump’s crypto advisory council, which is anticipated to play a significant role in the formulation of crypto policy. Reuters previously reported that the crypto czar was expected to oversee that group and harmonize policy across different regulatory agencies.
Such coordination will be essential, as a legal framework for crypto would require substantial contributions from the SEC and the Commodity Futures Trading Commission, whose new chairperson has yet to be announced, and it may also necessitate congressional endorsement, lawyers noted.
Regulatory issues pertaining to less controversial matters, such as proprietary bank trading and capital, have been entangled for years due to disputes between agencies, they remarked.
“There would definitely be a lot of people involved,” Powell added. In an email on Friday, a spokesperson for the Trump transition reaffirmed the President-elect’s announcement from Thursday, stating that Sacks would guide crypto policy and did not address Reuters’ inquiries regarding further details about the role.
Some advocates for consumer protection have voiced worries that the Trump administration’s crypto agenda could create loopholes that might leave investors vulnerable, a concern that the industry has largely dismissed.
“I don’t believe there will be a lack of regulation,” stated Anthony Scaramucci, founder of asset management firm SkyBridge and a former member of Trump’s first administration. “I don’t think it will lead to fraud, but I believe it will help the United States maintain its position as a leader in financial services.”
Crypto industry pushes for policy sea change after Trump victory
The cryptocurrency sector is advocating for a bold set of policies aimed at facilitating the widespread use of digital assets and is contemplating the best individuals to promote them, especially as they expect a favorable environment for cryptocurrencies under President-elect Donald Trump.
Crypto companies were already preparing for a more lenient regulatory approach with a new administration, and Trump’s significant victory, along with a projected Republican majority in Congress, opens the door for a substantial and lasting transformation in crypto policy. Trump has attracted support from the crypto community by promising to be a “crypto president,” and industry leaders believe he now possesses a strong mandate to fulfill those promises.
The sector is now urging for various initiatives, including possible executive orders that would enhance crypto firms’ access to banking services and the appointment of crypto-friendly individuals to key positions, along with a new chair for the Securities and Exchange Commission (SEC), according to executives.
Mike Belshe, CEO of institutional crypto platform BitGo, who organized a campaign fundraiser for Trump in July, said, “We’ve had an administration that’s been very negative, and so we’re looking forward to unlocking that gridlock.” He added, “I think the voters of America said very clearly that they want to see that.”
On Wednesday, Bitcoin surged past $90,000 amid growing optimism regarding policies, with some analysts forecasting that the leading cryptocurrency could reach $100,000.
Certain industry requests may be addressed swiftly, such as appointing pro-crypto nominees to financial regulatory bodies, but other initiatives, like establishing a regulatory framework for digital assets through legislation, may require more time.
Trump has also promised to form a crypto advisory council. Though it remains uncertain who will serve on the council, crypto leaders are currently brainstorming about which figures should be elevated to play significant roles in developing crypto policy in the new regime.
According to Kara Calvert, head of U.S. policy at Coinbase, “Everyone in Washington is asking and thinking about … who’s going to lead these agencies.” She remarked that it is crucial for companies like Coinbase, as well as smaller startups, to have a voice in this matter. Jonathan Jachym, global head of policy at the crypto exchange Kraken, noted that the industry is looking at who would be appropriate for leadership positions to influence policy.
Grzegorz Drozdz, an analyst at Conotoxia, stated that “Before the election, investors were already betting on options that the price of bitcoin would exceed $80k or even $100k, and the value of these bets has risen,” adding that the election results mainly propelled those bets.
Under the Biden administration, the SEC and Treasury imposed restrictions on crypto companies for alleged breaches of securities and anti-money laundering regulations, while banking regulators discouraged financial institutions from engaging with crypto, and Congress has been unable to pass legislation that would foster broader crypto adoption.
With Republicans in control of Washington, all of that could change
The crypto industry anticipates that Trump will fulfill his July commitment to create a strategic U.S. bitcoin reserve—an ambitious promise that executives now view as a genuine possibility. Marshall Beard, Chief Operating Officer of the Gemini exchange, stated, “It legitimizes the asset class more.”
The sector also expects that Trump’s bank regulators will adopt a more accommodating viewpoint concerning cryptocurrencies. Numerous crypto companies have faced challenges in finding banking partners due to scrutiny from regulators who are apprehensive about the associated risks, especially in light of last year’s collapse of crypto-friendly U.S. banks.
Jachym mentioned that there had been “negative pressure” from bank regulators on crypto relationships, which might shift if legislators develop a new framework for cryptocurrencies.
In July, Trump vowed that he would prevent banks from “choking” crypto firms out of the conventional financial system, and some leaders speculated that he could even tackle the issue through an executive order. Kristin Smith, chief executive of the Blockchain Association, a crypto trade organization, noted, “Something like that from the White House could go a long way towards fixing the problem.”
Earlier during the campaign, crypto businesses had hoped the new SEC chair appointed by Trump would implement a waiver regime for crypto firms, but companies are now discussing the possibility of seeking quicker “no-action” letters from the agency that could immediately allow crypto firms to operate without fear of repercussions, as stated by one executive.
Smith added that the sector is also gearing up for a renewed push for pro-crypto legislation. With Republicans expected to take control of the House, they could accelerate spending bills using a simple majority, a process known as “reconciliation,” which often allows smaller items to be included in essential spending bills. Smith remarked, “That could be a pathway for getting something done.”
Coinbase and various cryptocurrency firms invested over $119 million supporting congressional candidates who favor crypto, many of whom were victorious, including Ohio Republican Bernie Moreno. He secured a crucial Senate position from Democratic skeptic Sherrod Brown, setting the stage for potentially expansive legislation, according to executives. Calvert remarked that the 2025 Congress will be “the most pro-crypto Congress in history.”
During Election Night at Mar-a-Lago, Donald Trump celebrated his anticipated win with a lineup of prominent supporters. Among them were Elon Musk, Robert F. Kennedy, Jr., and Cantor Fitzgerald CEO Howard Lutnick.
One common factor among these individuals is their connection to cryptocurrency.
Although Trump had previously said little about the industry, he has relied on it for significant financial support for his campaign and related PACs. Securing that funding required him to make substantial commitments regarding the crypto sector.
On Election Night, digital asset markets experienced a surge, with bitcoin surpassing a record of $75,000 as his victory appeared increasingly certain. Stocks connected to crypto, like Coinbase and MicroStrategy, also rose in after-hours trading that Tuesday.
With a Republican-controlled Senate ahead, Trump faces minimal obstacles to implementing a more crypto-friendly agenda. Here are several initiatives he has promised to pursue:
Strategic national crypto reserve
In Nashville last July, Trump was the keynote speaker at the largest bitcoin conference of the year. In his address, he stated that if he returns to the White House, he will guarantee that the federal government does not sell its bitcoin assets. However, he did not propose establishing a formal federal reserve for digital currency.
“For too long, our government has overlooked the fundamental principle that every bitcoiner understands: Never sell your bitcoin,” he declared during his keynote speech.
Trump committed to preserving the current amount of bitcoin held by the U.S., which has been accumulated through asset seizures from financial offenders.
“If elected, it will be the policy of my administration that the United States of America will retain 100% of all bitcoin the government currently possesses or acquires in the future,” he stated.
At present, the U.S. Marshals Service routinely auctions off bitcoin and other cryptocurrencies stored in national reserves, such as ether and litecoin. These sales can occasionally cause declines in crypto prices, similar to earlier this year when Germany began selling off hundreds of millions of dollars in seized bitcoin.
‘On day one, I will remove Gary Gensler’
For months, Trump has expressed his intention to dismiss U.S. Securities and Exchange Commission Chairman Gary Gensler in public statements.
“On day one, I will fire Gary Gensler,” Trump remarked, referring to the SEC chairman appointed by Joe Biden, who has implemented a stringent approach to crypto regulation.
The president does not possess the authority to terminate the SEC chair. Even if Trump were to install a new chairman, Gensler would continue as a commissioner within the independent agency.
Gensler has initiated over 100 actions against crypto companies during his time leading the commission. In several interviews, the SEC chair has indicated that he believes a significant portion of the industry already falls under its jurisdiction, and his lawsuits are simply aimed at bringing the sector into compliance.
Crypto companies contend that the recent legal disputes haven’t provided the regulatory clarity they have been seeking; instead, they reflect a considerable overreach by the commission.
Trump also promised to form a “bitcoin and crypto presidential advisory council.”
“The regulations will be established by individuals who support your industry rather than oppose it,” he stated.
Trump has openly criticized Sen. Elizabeth Warren, D-Mass., who is widely regarded by the crypto community as a significant threat.
All bitcoin will be mined in America
In June, in Palm Beach, Florida, Trump met privately with a group of bitcoin mining leaders and experts for an hour and a half in a small tea room at the Mar-a-Lago Club. This closed-door meeting was the first time the former president engaged with the technologists responsible for securing the $1.5 trillion bitcoin network by operating large arrays of powerful machines.
The exclusive gathering included some of the most prominent private and public American miners in the field, featuring representatives from Riot Platforms, Marathon Digital Holdings, Terawulf, CleanSpark, and Core Scientific.
Less than four hours after the meeting ended, Trump took to social media to commend the bitcoin mining industry.
“Biden’s aversion to Bitcoin only benefits China, Russia, and the Radical Communist Left. We desire for all remaining Bitcoin to be PRODUCED IN THE USA!!! It will enable us to be ENERGY DOMINANT!!!” Trump posted on Truth Social shortly following his meeting.
Since that time, Trump has repeatedly expressed similar views.
“If cryptocurrency is destined to shape the future, I want it to be produced, created, and crafted in the USA,” Trump stated in Nashville.
“We will generate so much electricity that you’ll be begging, ‘Please, please, President, we don’t want any more electricity. We can’t handle it!’” he continued.
Federal Reserve interest rate reductions
In August, Trump mentioned that, if he were to win the election, he would decrease interest rates.
The Federal Reserve, which manages the nation’s monetary policy, determines the key interest rate. It also, intentionally, operates independently from the presidential office.
In September, Fed Chair Jerome Powell chose to cut rates by half a point in its first easing initiative in four years.
Historically, rate cuts and a more accommodative monetary policy coincide with a significant rise in cryptocurrency prices since it lowers the cost of borrowing money.
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