Crypto Industry Applauds President Trump's Executive Action

President Donald Trump has fulfilled two campaign promises with a recent executive action that establishes a framework for cryptocurrency regulation and exploration of a national digital asset stockpile.

Presidential Working Group to Coordinate Regulation

The executive order creates a presidential working group tasked with developing a comprehensive regulatory framework for digital assets. The working group, chaired by White House AI and crypto czar David Sacks, will include key financial regulators such as the Treasury Secretary and SEC Chair.

Digital Asset Stockpile Evaluation

The order directs the working group to evaluate the feasibility of establishing a national digital asset stockpile, potentially drawn from cryptocurrencies seized by law enforcement. This could expand the scope of cryptocurrencies held by the government beyond Bitcoin.

Reversal of Biden's Cryptocurrency Study

Trump's action revokes a 2022 executive order by President Biden that called for a study of crypto assets by various government agencies. Instead, it encourages strong measures to mitigate the risks posed by digital assets.

Market Reaction and Industry Optimism

Bitcoin (BTC) experienced a slight surge and subsequent dip following the executive action. However, it remained marginally higher over the past 24 hours, reflecting investor optimism about the industry's future under Trump's pro-crypto stance.

Regulatory Framework Development

Within 30 days, the working group will identify existing regulations and guidance affecting cryptocurrencies across government agencies. Recommendations regarding these items will follow within 60 days.

Legislative Proposals and Report

Furthermore, the working group will submit a report to the President within 180 days, outlining regulatory and legislative proposals and recommendations.

Rescission of Accounting Guidance

Concurrent with Trump's executive action, the Securities and Exchange Commission (SEC) has rescinded accounting guidance (SAB 121) that hindered financial institutions from safeguarding cryptocurrencies for clients.

Potential for Government Crypto Reserve

Industry leaders advocate for the creation of a strategic bitcoin reserve, citing its potential to stabilize the US economy and strengthen the US dollar. However, government purchases of cryptocurrencies may require congressional approval.