A simple executive order issued on January 20 will pave the way for the revival of the cryptocurrency industry in the U.S.

Dear President-elect Trump,

As co-director of the digital asset practice at a major law firm, I hope that your nominee for chairman of the Securities and Exchange Commission (SEC) will implement the much-needed (and overdue) reforms on how the SEC approaches regulation of the cryptocurrency market in the U.S.

However, as you know, it will take time for your nominee to be confirmed as SEC chairman and for him to establish new guidelines and rules for the cryptocurrency industry. With that in mind, I write this letter respectfully to propose an Executive Order that you could issue — on Day One of your presidency — aimed at restoring the U.S.'s leadership role in the rapidly evolving cryptocurrency financial system.

While other countries are racing to create regulatory clarity for a thriving cryptocurrency business environment, U.S. lawmakers and regulators have thus far refused to shape and modernize rules that have existed for decades, which were never intended to apply to this groundbreaking technology, leaving U.S. market participants adrift in a sea of regulatory ambiguity.

Meanwhile, the SEC under its current leadership, Gary Gensler, has brought case after case against cryptocurrency companies, projects, and founders based on allegations that they have violated these outdated and antiquated requirements, even in the absence of actual fraud or harm to investors.

It’s no surprise that this regulatory approach has forced many innovators and leading businesses in the digital asset space to relocate overseas, jeopardizing the U.S.'s leading position in the global economy.

How to Find Your Way Back

The good news is that it is still not too late to turn the tide. The current moment presents a once-in-a-lifetime opportunity to transform America into the cryptocurrency capital of the world and harness the transformative promise that digital assets and blockchain technology offer to our country. While many legislative, regulatory, and tax reforms are needed to seize this opportunity, there is one immediate action you can take — on Day One of your presidency — to pave the way for the revival of the cryptocurrency sector in the U.S.

You could issue an Executive Order on January 20 directing all federal agencies:

1. Immediately suspend all investigations, enforcement actions, and prosecutions of cryptocurrency companies, projects, and founders unless they involve credible allegations of (a) fraud or other intentional wrongdoing causing harm to investors or other victims or (b) threats to our national security.

2. Provide a written report to the President's Office within 180 days, detailing why the relevant agency should not immediately terminate those proceedings.

3. Promptly terminate all investigations, enforcement actions, or prosecutions of cryptocurrency companies, projects, or founders that do not ensure continued prosecution.

What the Proposed Executive Order Will Accomplish

?This proposed executive order will be extremely important to eliminate the chilling effect on the digital asset industry caused by the explosion of government enforcement lawsuits in recent years, including actions against good actors, those not following outdated and unenforced rules without harming any investors.

Most notably, the SEC has extracted billions of dollars in restitution — a financial penalty that some courts have ruled should only be used in cases where alleged illegal conduct has caused monetary harm to victims — in enforcement actions against cryptocurrency without victims.

Many of these lawsuits have sought to impose harsh penalties on legitimate cryptocurrency market participants who are providing the necessary digital infrastructure for these markets to thrive in the U.S. It is time to reevaluate this clumsy approach to enforcement. The proposed executive order could achieve this on your Day One of the presidency.

To be clear, you have sufficient authority to do this. Article II of the Constitution grants the President the unilateral power to issue such Executive Orders without the need for legislation or regulatory rules. The Office of Legal Counsel of the Department of Justice has opined that Article II empowers the President to compel all federal agencies — including independent regulatory agencies like the SEC — to comply with executive orders, such as the order proposed here, which will apply universally to all agencies of the Executive Branch.

You can turn America into the hub of the global cryptocurrency economy. The proposed executive order could be your first step, on Day One of your presidency, towards that goal.

Note: The views expressed in this article are those of the author and do not necessarily reflect the views of Binance Square, Inc. or its owners and affiliates.

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