The Crypto Industry Expects Regulatory Clarity From The Trump Administration

U.S. President Donald Trump has kept his pre-election promise on crypto and a pro-crypto Congress and Senate is turning out to be a boon for the emerging technology industry.

On January 23, Trump signed the ‘Strengthening American Leadership In Digital Financial Technology’ Executive Order (EO). He also announced the Stargate Initiative, a $500 billion private sector deal to expand American AI infrastructure.

The President has set the “tone at the top” to drive the the crypto and AI industry by supercharging the investment, confidence, and adoption of these fledgling technologies while supporting U.S.-led innovation and growth.

The U.S. technology sector, and in particular both the crypto and AI industry, has talent and capital in spades, two of the three most important ingredients to drive innovation with ubiquitous utility to society, what is required of both is balanced policy and regulatory clarity.

The new administration and the regulators are off to a shotgun start, and the crypto industry has very high expectations.

Laying The Foundations For Regulatory Clarity

The EO signals the establishment of a structured digital finance landscape, making way for digital assets to play an important and legitimate role in the American economy.

The EO bans CBDCs by withdrawing support for government-backed digital dollars in the U.S. in favor of private sector stablecoins to underpin the dollar’s global domination through the use of U.S. dollar backed stablecoins.

This week it was announced that the Senate Banking Committee, Senate Agriculture Committee, House Agriculture Committee, and House Financial Services Committee will be coming together to form a bicameral crypto committee to create a stablecoin bill and federal regulatory framework for digital assets. David Sacks, Trump’s new crypto and AI czar, is proving an invaluable advisor to the administration.

Abdul Rafay Gadit, Co-Founder of Zignaly, explained, “Trump’s clear dictums will catalyze crypto adoption rates as big investors, financial institutions, and retailers actively start investing in crypto. We’ve seen how, soon after the executive order, $1.19 billion flowed into crypto ETPs, taking the total assets under management to $171 billion, with Bitcoin ETPs making 82 percent of the total value. This marks the beginning of a golden age of the American economy fueled by crypto assets.”

SEC Acting Chairman Mark T. Uyeda’s immediate action upon appointment was to rescind the Staff Accounting Bulletin (SAB) 121 rule that required financial institutions to list crypto assets held on behalf of customers as liabilities. Now, SAB 122 promotes institutional involvement by removing entry barriers for traditional banks to offer crypto custodial services without maintaining complex account books.

Uyeda has launched a crypto task force dedicated to developing a comprehensive and clear regulatory framework for crypto assets. Commissioner Hester Peirce, known as “Crypto Mom”, is very well respected across industry and government agencies, and will lead the task force that will focus on regularity clarity on digital assets and securities regulations and boost the reduction of public-chain fraud.

The CFTC announced that Acting Chairman Caroline D. Pham is launching a series of public roundtables on evolving trends and innovation in market structure, including issues such as affiliated entities and conflicts of interest, prediction markets, and digital assets. Pham renewed calls for open public engagement and increased transparency by the CFTC on its policy approach to changes in derivatives markets.

This regulatory engagement model is one that industry associations and the big digital finance players have been constantly asking for and making themselves and their resources available for, for years, and many were mostly shunned and in some instances prosecuted in the last administration. Pham and the SEC’s Peirce have been two of a small number of agency commissioners that have engaged with the global industry, listening, and offering support, throughout, and have great respect from the global digital finance community.

Rob Behnke, the Co-founder, executive chairman, and president of Halborn, says, “I feel like the entire industry is experiencing a state of vertigo because of how quickly and drastically things changed. We’ve gone from Operation ChokePoint 2.0, which debanked most US technology innovators in this industry, to complete and total support.

The real, proper use cases in the industry are, of course, bitcoin first and foremost, followed by stablecoins, UX, and tokenization of assets. Trump is accelerating everything right now by years. Most importantly, he has some of the most innovative and highest integrity names in American crypto as ambassadors and decision-makers behind things like repealing SAB 121 and pushing forward FIT 21 to establish what a commodity, security, and collectible is.

However, since the actual stores of value are now open-source code repositories that can be cloned immediately, scammers and fraudsters will be much more rampant. Hopefully, the SEC or another governing body can clamp down on the people who are clearly scamming.”

It is also reported the the SEC is scaling down on crypto regulation by enforcement, and message that has put big a smile on the face of many in the industry and signals the start of the next wave of greater investment in both technology companies and digital assets in the U.S. by digital finance players and capital allocators alike.

Strengthening Dollar, Powering Growth

Trump’s EO is focused on strengthening the U.S. dollar and, consequently, the American economy. In addition to the ban on CBDCs and the focus on (USD) stablecoins, bitcoin has an important role to play.

Although the EO didn’t mention the formation of a strategic bitcoin reserve, the President has charged the Treasury and Commerce Departments to establish a sovereign wealth fund in a separate order. The wealth fund may be an avenue for buying and accumulating digital assets like bitcoin.

Philip, chief marketing officer of Strategic Bitcoin Reserve Coin ($SBR) on Ethereum, noted, “The Executive Order is a massive step towards achieving the goal of Congressional approval for Senator Lummins’ Strategic Bitcoin Reserve (SBR) bill. While some might view the Executive Order as a blow to the SBR movement, it’s quite the opposite.

Executive orders oftentimes have a shelf life that lasts as long as the current administration term. However, Congressional approval for a bill like Senator Lummins’ SBR would establish a long-term plan rooted in the government’s belief in bitcoin’s ability to reduce the deficit, hedge against inflation, and possibly shore up the dollar.”

After signing the EO, Donald Trump spoke virtually at the World Economic Forum, renewing his pledge to make America “the world capital of artificial intelligence and crypto.” No prizes for guessing why he launched the Stargate Initiative for building AI infrastructure around the same time.

Michael O’Rourke, co-founder Of Pocket Network, elaborated on Trump’s commitments toward the AI industry. He said, “The data centers that power AI training and deployment require enormous energy and put pressure on the national power grids. With the rise of AI models, the energy demand will grow significantly as Goldman Sachs predicts a 160 percent rise in power demand. By deregulating the energy sector, Trump is set to make America an AI hub”.

The Stargate Initiative has begun with a $100 billion investment in the first phase to build data centers in Abilene, Texas, and plans to build 20 more facilities. Such a project is set to create jobs beyond tech in the construction and energy infrastructure sectors.

Tiger Li, vice president of AI Ecosystem at AI DePIN Phoenix noted, “Despite already being the de facto AI leader of the world, it definitely makes sense for the Trump administration to further push for absolute AI sovereignty without any dependency on foreign supply chains. Leveraging America’s huge energy reserves also gives a substantial edge to dominate the AI space in the foreseeable future. The focus on infrastructure is crucial for the purposes of bolstering the entire country, from the economy to national security.”

The stage is now set. Trump’s new administration is expected to unlock a new era of growth and innovation, allowing America to reclaim lost time and ground and reach new heights as a global leader in digital finance technologies and emerging innovation.

The industry is waiting, and it looks as if it won’t have to wait long, U.S. stablecoin legislation expected within 100 days. The rest of the world is watching.