The US is playing catch-up.
As other countries raced ahead in creating their own bespoke laws for crypto, legislative disinterest, gridlock, and a crackdown from regulators meant there was no such progress in the world’s largest economy.
That could soon change — President-elect Donald Trump has said he’ll make the US the “crypto capital of the planet.”
“From now on, the rules will be written by people who love your industry, not hate your industry,” he pledged at a Bitcoin conference in July.
Indeed, the next chair of the House’s powerful Financial Services Committee, Arkansas Republican French Hill, is one of the most pro-crypto lawmakers in Washington.
Trump’s regulator and adviser picks so far have ties to the industry or have spoken favourably about crypto.
The outcome of the US election has investors betting on a crypto gold rush.
“There’s a ton of optimism about the new administration,” crypto attorney Moishe Peltz told DL News.
But, he added: “While the vibes have shifted, there’s still not a lot of concrete guidance as to what you can and can’t do.”
Crypto watchers should mark their calendars for three dates in 2025 that will be crucial as Trump reclaims power in Washington.
January 3: The 119th Congress convenes
Republicans will control both chambers of the next Congress, and can begin pursuing their policy goals immediately.
That includes vetting the people Trump has nominated to run federal departments and agencies, though there’s no guarantee Congress will do so before his inauguration.
“They usually go with the marquee secretaries first,” such as the secretaries of state and defense, Miller Whitehouse-Levine, the head of crypto advocacy group DeFi Education Fund, told DL News.
Crypto executives and investors have high hopes for several Trump nominees, including Paul Atkins, the incoming president’s pick to head the Securities and Exchange Commission.
But it might be awhile before he takes office — his predecessor, current SEC chair and crypto bogeyman Gary Gensler, didn’t assume the role until April 2021, three months after Biden took office.
Another crypto-friendly nominee who could earn Senate approval earlier include hedge fund manager Scott Bessent, Trump’s pick to lead the Treasury Department.
Also high on the list will be Cantor Fitzgerald CEO — and Tether investor — Howard Lutnick, Trump’s pick to lead the Commerce Department.
January 20: Trump’s inauguration
There are things that the administration will be able to do immediately after Trump takes office, Whitehouse-Levine said.
That includes adding to or axing altogether an executive order that Biden issued in 2022. The order angered some in the industry due to its focus on crypto’s risks, rather than its potential benefits.
This is also the day Gensler resigns from his position atop the SEC. His departure could have one dramatic and immediate change.
“The SEC could immediately rescind SAB 121, which doesn’t require notice and comment or anything like that,” Whitehouse-Levine said.
Critics say that Staff Accounting Bulletin 121, an obscure piece of accounting guidance published by SEC staff in 2021, makes safeguarding large amounts of crypto — a business known as custody — financially impossible for big banks.
That’s because it forces publicly-traded banks to record crypto assets as liabilities on their balance sheets.
Congress voted to scrap SAB 121 in 2024, but Biden vetoed the effort.
April 30: The end of Trump’s first 100 days
Congressman Hill recently said Republican majority leader Steve Scalise intends to pass a major piece of crypto legislation within Trump’s first 100 days.
Specifically, the pair will pursue a so-called market structure bill: one that broadly outlines how crypto is to be regulated in the US.
The House passed such a bill in 2024. It was called FIT 21, and its passage was cheered by many in the industry.
Co-sponsor Patrick McHenry, a Republican from North Carolina, said the bill was written to end the “food fight” between the SEC and the Commodity Futures Trading Commission, both of which were vying to be crypto’s primary regulator in the US.
The regulators tend to deny that there’s a turf war raging between them.
“This is the biggest moment in crypto policy and legislating in United States history thus far,” Rashan Colbert, head of policy at dYdX Trading, previously told DL News.
The bipartisan vote included a substantial number of Democrats, and signalled that Congress, like the crypto industry, was eager to rescue digital assets from their legal limbo.
Others in the industry, however, were vehemently opposed to it moving any further.
“That bill was an industry compromise, but it was made under duress,” Matthew Sigel, VanEck’s head of digital assets research, said on a recent webinar.
“It’s bad for DeFi because it requires exchanges to collect personal information from users buying small cap tokens, and I think that the Republican leadership is going to rip that bill up and start [over].”
Republicans have also said they intend to pursue a major stablecoin bill in the coming Congress.
The trouble is, they will have a razor-thin majority in the House.
“No one has any clue what they’re going to be able to accomplish next year,” Whitehouse-Levine said.
“There are many, many priorities on the Republican caucus’ agenda, and it’s less a question about whether crypto is going to be a priority in the next Congress, and more of how many other higher priorities will be taking up time, and how efficient can Congress be?”
Whitehouse-Levine says there are other bills that are less sweeping in scope but no less important to the industry that have a greater chance of passing in 2025, such as Minnesota Representative Tom Emmer’s Blockchain Regulatory Certainty Act.
That bill would affirm that crypto developers and service providers that do not custody user funds are not money transmitters.
“If there’s controversy around those other two bills,” Whitehouse-Levine said, Emmer’s “could be more ripe for movement.”
Aleks Gilbert is DL News’ New York-based DeFi Correspondent. Got a tip? Email at aleks@dlnews.com.