On January 20, Donald Trump is set to take office as the President of the United States, and with his inauguration comes a series of executive orders poised to reshape the cryptocurrency industry. While broader regulatory frameworks will take time to develop, Trump’s immediate actions signify a clear commitment to fostering innovation and growth in the crypto sector. This article explores the potential impact of his proposed policies and executive orders on the cryptocurrency market.

Repealing the Controversial SAB 121 Regulation

One of the most contentious policies in the financial and crypto sectors under the Biden administration was the SEC’s Staff Accounting Bulletin No. 121 (SAB 121). This regulation required banks and financial institutions holding cryptocurrencies on behalf of customers to record these holdings as liabilities on their balance sheets. Critics argued that this policy created unnecessary legal and accounting burdens, discouraging financial institutions from engaging with cryptocurrencies.

In 2024, both the U.S. House of Representatives and the Senate voted to repeal SAB 121, but President Joe Biden vetoed the bill, maintaining the regulation. This decision exacerbated tensions between the crypto community and the Biden administration, as many viewed the policy as a barrier to the industry's growth.

President-elect Trump has pledged to address this issue immediately upon taking office. Reports indicate that he plans to sign an executive order directing the SEC to repeal SAB 121 and provide clearer, more transparent guidelines for handling crypto assets on balance sheets. By removing this regulatory hurdle, Trump aims to reduce legal burdens and encourage greater participation from major financial institutions in the cryptocurrency market. This move could pave the way for increased institutional adoption and innovation in the sector.

Establishing a Crypto and AI Advisory Council

Another cornerstone of Trump’s crypto strategy is the formation of a Crypto and Artificial Intelligence Advisory Council. This council, a first in U.S. history, is designed to provide strategic guidance on managing and developing the cryptocurrency and blockchain industries. Comprising approximately 20 leaders from top technology and financial firms, the council will advise the President and regulatory agencies like the SEC and the CFTC on crypto-related policies.

The council will be led by Bo Hines, a former Republican candidate for the U.S. House of Representatives, and will operate under the direction of David Sacks, an early PayPal executive and trusted White House advisor on crypto and AI. With this initiative, the administration aims to foster collaboration between regulators and industry leaders, ensuring that policies are consistent, transparent, and supportive of innovation. Additionally, the CFTC is expected to gain expanded authority to oversee cryptocurrencies classified as commodities, reducing the influence of the SEC in this domain and streamlining regulatory processes.

Creating a National Bitcoin Reserve

Trump has repeatedly emphasized his ambition to establish a national Bitcoin reserve. According to insiders, he plans to sign an executive order on his first day in office to designate Bitcoin as a national reserve asset. This policy would draw upon provisions from the Dollar Stabilization Act, granting the President special authority to protect the U.S. dollar and implement financial strategies such as forming a Bitcoin reserve.

Experts believe this initiative could bolster Bitcoin’s value and position the U.S. as a global leader in cryptocurrency adoption. Trump’s vision includes using Bitcoin to address the national debt, which currently stands at $38 trillion, and driving the cryptocurrency’s price to $150,000 during his term. While some skeptics, including Galaxy Digital CEO Mike Novogratz, doubt the feasibility of such a reserve, the move reflects Trump’s commitment to integrating Bitcoin into the national financial strategy.

Pardoning Ross Ulbricht

Trump’s plans also include pardoning Ross Ulbricht, the founder of the Silk Road marketplace. Ulbricht is currently serving a life sentence without parole for his role in the darknet platform. Trump has stated that granting clemency to Ulbricht would symbolize a new chapter for the crypto industry, recognizing past mistakes while advocating for a balanced approach to regulation.

Ulbricht’s release could signal a broader shift in how the U.S. government approaches individuals and businesses in the crypto space, potentially encouraging more open dialogue and progressive policy changes.

Future Executive Orders

Beyond these initial actions, Trump is reportedly preparing a series of additional executive orders to further support the crypto industry. These include:

  • Directing the U.S. State Department to collaborate with international partners to promote crypto innovation and create a favorable regulatory environment for American businesses abroad.

  • Reversing SEC policies that have hindered decentralized finance (DeFi) projects.

  • Implementing protections to ensure crypto companies have access to banking services, countering accusations of discrimination under initiatives like Operation Choke Point 2.0.

Trump’s administration also plans to simplify regulations for decentralized exchanges (DEXs) and promote greater cooperation between federal agencies to streamline crypto oversight.

The Road Ahead

While the first day of Trump’s presidency will likely be packed with critical actions, not all proposed crypto policies will be implemented immediately. However, the inclusion of these measures in his administration’s top priorities underscores Trump’s determination to position the U.S. as a global leader in the cryptocurrency market.

If successfully executed, Trump’s policies could unlock new growth opportunities for the crypto industry, enhance U.S. competitiveness, and foster a more innovation-friendly environment. As the world watches, the potential of the cryptocurrency market under President Trump’s leadership promises to be one of the most closely monitored developments in the years to come.

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