Bitcoin Surges Amid Optimism for Pro-Crypto Policies Under Trump Administration

Featured & Cover Bitcoin Surges Amid Optimism for Pro Crypto Policies Under Trump Administration

Bitcoin has soared to unprecedented levels following President-elect Trump’s victory, with the cryptocurrency market rallying in anticipation of favorable federal policies. The price of Bitcoin has neared $100,000, a rise exceeding 40% since Trump’s election, as the president-elect promises to position the U.S. as the “crypto capital of the planet.”

The market’s enthusiasm is amplified by expectations of regulatory shifts, particularly with the anticipated departure of Securities and Exchange Commission (SEC) Chair Gary Gensler and the appointment of pro-crypto figures in Trump’s Cabinet. “The sense is the new administration, at the very least, is going to facilitate productive engagement with the regulators,” said Katherine Kirkpatrick Bos, general counsel for cryptography firm StarkWare. She highlighted a stark contrast to the “very combative” relationship between the crypto industry and the SEC over the past four years.

Bos noted the excitement among institutional investors who believe the upcoming administration will foster meaningful discussions about legal issues affecting the industry. “There is now a sense that productive conversation surrounding these core legal issues has made institutional investors very excited and more willing to engage with crypto assets,” she added.

Bitcoin’s value spiked 8% the day after the election, triggering a multi-day rally that peaked at over $98,700 on November 22. While the cryptocurrency briefly slid toward $90,000 last week, analysts remain confident in the market’s resilience, with one describing it as “structurally sound.”

Despite Trump’s previous skepticism about cryptocurrencies, his recent actions signal a shift in perspective. Billionaire investor Scott Bessent, a known supporter of digital assets and founder of the hedge fund Key Square Group, has been tapped to lead the Treasury Department. Ripple CEO Brad Garlinghouse called Bessent “the most pro-innovation, pro-crypto Treasury [secretary] we’ve ever seen.” Reports also suggest Trump’s team is considering creating a dedicated “crypto czar” position to oversee cryptocurrency policy and regulation.

Faryar Shirzad, chief policy officer at Coinbase, highlighted the challenges faced by the industry due to regulatory uncertainty. “We have had such difficulty [building] the next generation of the financial system and the next generation of the internet in the United States because of the lack of regulatory clarity,” Shirzad said. “Now we have an administration and a Congress who understand the potential of the technology.”

Coinbase has played a pivotal role in advancing the crypto industry’s political engagement, contributing $70.5 million to the Fairshake super PAC during the election cycle. Attention now turns to who will succeed Gensler as SEC chair, with floated candidates including former acting Comptroller of the Currency Brian Brooks and former SEC officials Paul Atkins and Robert Stebbins.

Nathan McCauley, CEO of Anchorage Digital, criticized the prior administration’s “regulation by enforcement” approach and expressed hope for “regulation by rulemaking” under new leadership. Bos underscored the need for updated regulations that align with the unique nature of digital assets. “There are a number of things that just don’t fit in our current regime,” she said. Shirzad added, “The most basic thing that the new chair can do is just signal an openness to providing the clarity that the industry has been asking for.”

The momentum is extending to Capitol Hill, where federal lawmakers are echoing Trump’s pro-crypto stance. Senator Cynthia Lummis (R-Wyo.) plans to reintroduce the BITCOIN Act, which proposes creating a strategic bitcoin reserve for the U.S. to counter inflation and mitigate dollar devaluation. Lummis expressed optimism about its prospects, stating, “The push for it is gaining momentum.”

Trump has also shown support for the idea of a bitcoin reserve, pledging during a Bitcoin Conference in July to ensure the federal government retains all its bitcoin holdings. While the BITCOIN Act’s fate in the Senate is uncertain, changes in congressional leadership are boosting industry confidence. Senator-elect Bernie Moreno (R-Ohio), who ousted crypto skeptic Sherrod Brown, is expected to lead a more pro-crypto Senate Banking Committee. Moreno and Senator Tim Scott (R-S.C.), another crypto advocate, have vowed to prioritize innovation and consumer protection through clear regulatory guidelines.

Scott, however, may face resistance from Senator Elizabeth Warren (D-Mass.), who is set to become the Banking Committee’s ranking member. Warren has consistently called for stricter oversight of cryptocurrency trading. Nonetheless, bipartisan interest in crypto marks a significant shift, particularly after the collapse of FTX dampened enthusiasm.

Chen Arad, co-founder of compliance hub Solidus Labs, noted the changing dynamics. “After the election, a lot of Democrats want to talk, want to understand, want to take part in this effort,” he said. “This is bigger than any party at this point.” Solidus Labs formed the Crypto Market Integrity Coalition in 2022, bringing together 55 institutions like Coinbase and Robinhood to push for regulatory clarity.

The coalition has proposed several measures, including a national framework for stablecoins—cryptocurrencies tied to fixed values—and a market structure bill to delineate the roles of the SEC and the Commodity Futures Trading Commission. Earlier this year, the House passed the Financial Innovation and Technology for the 21st Century Act, which aimed to address these issues, though it stalled in the Senate.

As the crypto industry awaits Trump’s formal inauguration, the optimism surrounding regulatory and legislative changes is palpable. Stakeholders see an opportunity for the U.S. to become a global leader in cryptocurrency innovation, fueled by clearer rules and a supportive government. The coming months will reveal whether the anticipated transformation of U.S. crypto policy materializes.

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