Ahead of the U.S. presidential election, Republican candidate Donald Trump made numerous promises to the cryptocurrency industry. Now that he has been elected, significant changes could be on the horizon.
As it became clear that Trump had defeated Democratic candidate Kamala Harris for the White House, Bitcoin surged to a new all-time high, continuing to rise to $76,872 as of November 7, according to CoinGecko.
Speaking with Cryptopolitan, Alice Liu, head of research at CoinMarketCap, stated that Trump's victory could continue to 'change everything' in the cryptocurrency industry.
In his campaign, Trump positioned himself as an ally of the cryptocurrency industry, promising to make the United States the 'cryptocurrency capital of the world' through various measures, such as not taxing cryptocurrencies and calling for Bitcoin to be created and held on American soil.
Liu stated: 'His plan includes dismantling existing regulatory frameworks, appointing an advisory council on Bitcoin and cryptocurrency to lead the SEC.'
She added: 'He also discussed easing legal barriers for the industry - marking a stark contrast with the Biden administration's focus on strict oversight and consumer protection.'
However, Liu believes that a specific promise could bring tremendous benefits to the cryptocurrency industry in the long run.
She said: 'Trump's idea of creating a strategic Bitcoin reserve fund could legitimize Bitcoin as an important asset.'
'If successful, the United States would be the first major economy to regard Bitcoin as a reserve asset, which could attract institutional investment and send a strong signal to other countries about the viability of cryptocurrencies.'
The policy of the U.S. cryptocurrency industry under Trump
Trump's second presidential term will not officially begin until January 20, 2025, Inauguration Day.
Jonathan Jachym, global policy director at cryptocurrency exchange Kraken, told Cryptopolitan that the election results could be a 'critical turning point for cryptocurrency policy.'
Under the Biden administration, the Securities and Exchange Commission (SEC), through Chairman Gary Gensler, has cracked down heavily on cryptocurrency companies.
According to a study by litigation consulting firm Cornerstone Research, SEC enforcement actions under Gensler reached a 10-year high in 2023, with a large portion of these actions relating to cryptocurrency companies.
The agency has yet to release its annual enforcement report for actions in fiscal year 2024. However, in an announcement on October 21, the SEC's Inspection Division outlined its priorities for 2025, listing cryptocurrency as a priority for examination.
In his campaign, Trump vowed to fire Gensler on his very first day in office.
Jachym said: 'President Trump and his team have made cryptocurrency a significant part of their campaign platform, and we have seen many new pro-crypto members elected to Congress from both parties.'
'Our lawmakers and industry have worked very hard over the past several years to push for bipartisan legislation to regulate centralized intermediaries, not just rules.'
A mixed bag for the cryptocurrency market
Cory Klippsten, CEO of Bitcoin platform Swan Bitcoin, told Cryptopolitan that he believes Trump's victory could bring a mix of emotions, 'with a blend of pro-business rhetoric and some anti-crypto views from those wanting to preserve the status quo of the USD.'
Critics of cryptocurrency have viewed it as a potential threat to the dominance of the U.S. dollar in the global economy by reducing other nations' reliance on the U.S. financial system.
Klippsten said: 'The Trump administration could create short-term disadvantages for Bitcoin by maintaining a hard-line stance on digital assets, potentially lumping them together with his views on other disruptive technologies.'
'But Trump's non-intervention in regulation could also promote the development of Bitcoin as a decentralized, unregulated store of value. Ultimately, Bitcoin does not need government approval—it thrives on its independence.'
Easing regulations could be on the table
Speaking with Cryptopolitan, Greg Magadini, head of derivatives at cryptocurrency data firm Amberdata, said the most notable mid-term impact of Trump's presidency could be the easing of regulations for builders in the space.
He said: 'Releasing Ross Ulbricht and firing Gary Gensler gives protocol builders confidence that the government is not against them.'
Magadini added: 'This is very significant for L1 chains like Eth and Solana, as their value derives from the protocols built and utilized on L1.'
Overall, Magadini believes that 'DeFi will be the big winner in this battle,' with the potential to 'ease restrictions on U.S. citizens using the protocol' in the future.
While Trump is capturing all the attention, Magadini said there are over 219 pro-crypto candidates who have been elected to the House and Senate, and that number continues to grow.
Although he is skeptical about the formation of a Bitcoin reserve fund, he said the idea behind this reserve fund and the influx of pro-crypto candidates is making the market feel 'bullish.'
Since the election, the cryptocurrency market has grown in every aspect, with Bitcoin standing out as it reached a new all-time high.
