The MAGA wave emerges, and flags are flying in the crypto field.
Article author: Pzai
Source: Foresight News
Since Trump won this year's U.S. election, the 'MAGA' banner has swept across the entire crypto market with overwhelming momentum. Under the 'America First' principle, Trump regards cryptocurrencies as an important component of the U.S. financial system and has already begun planning to make Bitcoin a national reserve asset. In the intense preparations of the government team, a large number of crypto-friendly bureaucrats are taking office. The Trump family is also actively participating in the on-chain economy under the name 'World Liberty Finance' (WLFI) and has purchased over 75.26 million dollars in crypto-related assets. This article attempts to unravel the data from Trump's appointments and on-chain project bets to piece together a roadmap for the American 'crypto revival' led by Trump's team in the future.
New officer takes office
The new leadership team of Trump's administration includes many crypto-friendly individuals, and in the newly established 'Presidential Advisory Committee on Digital Assets', the chairman, 'Crypto Tsar' David Sacks, previously served as Chief Operating Officer at PayPal and will serve as the AI and crypto head of the U.S. government. In his personal and Craft Ventures' investment history, most projects are related to crypto asset management and Bitcoin infrastructure (such as crypto asset management BitGo and Bitwise, Lightning Network application Lightning Labs, Voltage, etc.). It can be expected that under Trump's administration, crypto-compliant custody products will advance further, even seeking suitable asset exits for Bitcoin reserves.
Bo Hines, a former college football player who has run for a seat in the North Carolina House of Representatives twice, and graduated from Yale University and Wake Forest University School of Law, will become the executive director of this committee. Although Hines has no relevant cryptocurrency experience, such an appointment indirectly proves that for the Trump administration, crypto compliance is a bottleneck that needs to be addressed. Furthermore, the Republican Party's advantageous position in the three branches of government also clears certain obstacles for the future promotion of crypto compliance policies in the U.S.
Moreover, beyond the 'direct line', various government departments are continuously seeing crypto-friendly individuals take office. For instance, among the popular candidates in the U.S. Commodity Futures Trading Commission (CFTC), which played an important role in previous crypto compliance cases, include Brian Quintenz, head of crypto policy at a16z (who supervises U.S. crypto futures contracts), Perianne Boring (a proponent of the Bitcoin mining industry), and Caroline Pham (who proposed a principled framework in 2023 to regulate the digital asset market and tokenization).
As for the U.S. Securities and Exchange Commission (SEC), Trump's dismissal of the current chairman Gary Gensler is already a done deal. He also nominated Paul Atkins as the new chairman of the SEC on December 4. As the CEO of the consulting firm Patomak Global Partners, Paul previously served as an SEC commissioner during the George W. Bush administration and has extensive experience in finance and cryptocurrency.
He also served as co-chair of the crypto industry advocacy organization Token Alliance, criticizing the current SEC chairman Gary Gensler's tough regulatory policies on the cryptocurrency industry, arguing that these policies could push the crypto industry outside the U.S., advocating for reduced regulation and emphasizing the importance of 'common-sense regulation' and free markets. Industry insiders expect Atkins to promote a clearer regulatory framework, reduce compliance costs, and encourage innovation. Earlier, Trump also had a phone conversation with Coinbase CEO Brian Armstrong, reflecting his compliance efforts within the U.S. framework.
In terms of the progress of the implementation of relevant laws, Trump plans to abolish the SAB 121 accounting announcement, which requires custodians to treat clients' cryptocurrency assets as liabilities and present them at fair value on the balance sheet, adding a financial burden to various custodians and exchanges. Another operation that Trump emphasized terminating is Operation Choke Point 2.0, which is the U.S. government's action to exert pressure on the cryptocurrency industry through regulatory agencies, restricting its access to banking services. This action is considered a continuation of the 2013 'Operation Choke Point', aimed at indirectly attacking specific industries through the banking system.
Under this action, agencies such as the Federal Deposit Insurance Corporation (FDIC), the Office of the Comptroller of the Currency (OCC), and the Federal Reserve issued joint statements or 'pause letters' requiring banks to stop or limit activities related to cryptocurrencies. Many cryptocurrency companies and their founders had their accounts closed without cause by banks, affecting the acceptance of cryptocurrencies by banks like Signature Bank. Additionally, Trump will continue to promote the implementation of the Financial Innovation and Technology Act of the 21st Century (FIT 21) during his term, which clarifies the definitions of key terms such as 'digital assets', 'blockchain systems', and 'decentralized governance systems', and categorizes digital assets into three types: restricted digital assets (similar to securities), digital commodities, and licensed payment stablecoins, delineating the regulatory responsibilities of the SEC and CFTC, and strengthening information disclosure requirements, mandating that digital asset issuers and exchanges provide transparent and accurate information, and establish consumer protection clauses and dispute resolution mechanisms. This also reflects that Trump is bound to lay a solid foundation for the steady compliance of cryptocurrencies during this term.
For the U.S. crypto market, its development generally remains coordinated with compliance progress, but this process has not been smooth sailing. Previously, the outbreak of the FTX incident and its aftermath had a profound impact on the market, shaking investor confidence and exposing shortcomings in the regulatory framework. This incident led regulatory agencies to impose stricter scrutiny on the cryptocurrency industry, with many projects struggling with compliance issues, resulting in overall market progress falling short of expectations.
However, with personnel rotations and policy adjustments at key regulatory agencies such as the U.S. Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC), the market is gradually welcoming a new turning point. Against this backdrop, some tokens are able to operate under a clearer regulatory framework, and compliance paths are gradually becoming clearer.
Taking XRP as an example, it was previously hampered due to the SEC's lawsuit, but as the case progressed and the regulatory environment improved, XRP gradually found a way out, and market confidence in it has also been restored. In addition, other tokens and projects have begun to explore innovations under clearer rules, reducing the compliance costs brought by regulatory uncertainty.
The 'barometer' role of WLFI
At the end of August this year, Eric Trump, the second son of Trump and current executive vice president of the Trump Organization, announced the official launch of the cryptocurrency project WLFI, and there have been frequent on-chain activities. This project was previously seen as a potential source of campaign funds for the Trump family.
After a series of ups and downs, WLFI secured $20 million in funding during its initial issuance, but the provision in its agreement stating that 'the Trump family is not liable for 75% of the profits' has also faced some skepticism within the crypto sector. After Trump takes office, WLFI is expected to serve as a direct display of his family's choices in crypto assets, achieving the role of 'American crypto barometer'.
Upon further investigation of WLFI's Protfolio, it can be seen that its backing is also closely related to Trump's team. For example, after Sun Yuchen invested 30 million dollars into WLFI, WLFI's on-chain Bitcoin reserves were converted to WBTC (interestingly, David Sacks has also invested in WBTC custodian BitGo).
On the other hand, the Protfolio and applications behind it are also somewhat related to the American VC Polychain, and in WLFI, Luke Pearson, a general partner at Polychain Capital, is listed as one of the advisory team members. The Scroll deployed by WLFI itself is one of the L2s led by Polychain, and one of the founders of Scroll, Sandy Peng, is also on the advisory list.
As the Trump administration's crypto policies gradually take shape, WLFI is expected to play a greater 'barometer' role in the future crypto market. Its asset allocation and strategic partnerships will continue to influence market trends, while potential support from professional institutions like Polychain will also provide ongoing momentum.
In the future, WLFI may continue to invest around high-quality DeFi assets while further enhancing its brand value and market voice through collaboration with other projects. In summary, WLFI, with its unique asset allocation, strategic partnerships, and political influence, has become an important barometer for the U.S. cryptocurrency market. Its future development will continue to attract widespread attention from the market and provide important reference signals for investors.
Conclusion
Trump's victory has brought unprecedented development opportunities to the U.S. cryptocurrency industry. By appointing crypto-friendly individuals, promoting compliance policies, and actively participating in family projects, the Trump administration is outlining a blueprint for an American 'crypto revival'.
From the perspective of legal compliance to close cooperation with industry leaders, Trump's crypto strategy aims not only to consolidate the U.S. leadership position in the global digital economy but also to inject new vitality into the standardization and innovation of the cryptocurrency market.
However, this path to revival is not without challenges. In the future, as policies gradually take shape and the market continues to mature, the U.S. is following the MAGA banner, becoming the center of the global crypto economy. Whether Trump's crypto strategy can truly achieve 'revival' not only concerns the future of the American financial system but will also profoundly impact the landscape of the crypto industry. Thus, whether cryptocurrencies can ultimately rise with the Trump effect or become 'losers' in the political chessboard, we may as well wait for history's answer.
