Cryptocurrency Enjoys Renewed Enthusiasm as SEC Task Force and Trump Optimism Emerge
The establishment of a new SEC cryptocurrency task force and the appointment of industry-friendly regulators under President Donald Trump have instilled fresh investor confidence in digital assets.
Following Trump's inauguration, the price of Bitcoin (BTC-USD) surged back above $106,000, reversing Monday's decline. The task force aims to provide regulatory clarity, facilitate registration, develop disclosure frameworks, and allocate enforcement resources effectively.
Despite prior clashes between the SEC and major crypto players during the Biden administration, the industry anticipates a more favorable stance under Trump. His nominee for SEC Chair, Paul Atkins, awaits Senate confirmation, while SEC Commissioner Mark Uyeda serves as acting chair.
This week, industry executives are testing the waters with new ETF applications involving assets such as XRP, SOL, Dogecoin (DOGE), and the President's "TRUMP" memecoin. Last year, the SEC approved spot Bitcoin ETFs from BlackRock and other asset managers.
"We anticipate a more welcoming approach from the SEC," said Matthew Sigel, head of digital assets research at VanEck. "We will see more product filings."
However, some industry players expressed slight disappointment that Trump failed to address crypto or issue executive orders on his first day in office. "The market is disappointed there was no activity with regard to crypto yesterday," said Dan Hughes, founder and CTO of Radix.
Hughes believes a positive executive order could significantly boost the sentiment. The repeal of Biden's March 2022 executive order on crypto assets, urging regulators to address digital asset risks, is among the actions the industry awaits.
"I'm disappointed that was not repealed," said Sigel. "The longer there's no executive order, the more impatient the market will get."
Crucial to the industry is the repeal of SEC accounting guidance that restricts banks from holding crypto in custody for clients.
The Trump administration has made pro-crypto personnel appointments, with Travis Hill and Caroline Pham serving as acting heads of the FDIC and CFTC, respectively. Pham supports clearer digital asset regulation and increased CFTC oversight.
Industry members remain optimistic. Leonard Lancia, CEO of Portofino Technologies, sees potential for a significant and well-thought-out executive order. Coinbase CEO Brian Armstrong believes Trump "really wants to be the first bitcoin president."
Armstrong advocates for a strategic bitcoin reserve, which Senator Cynthia Lummis is pursuing in Congress. "Any government that holds gold should also hold bitcoin," said Armstrong. "If the US gets a bitcoin reserve, many G20 countries will follow, driving bitcoin prices up."