President Trump Takes Executive Action on Cryptocurrency
Key Points:
* President Donald Trump signed an executive order establishing a presidential group to coordinate digital asset regulation.
* The order prohibits the creation of central bank digital currencies (CBDCs).
* The working group will evaluate the potential creation of a national digital asset stockpile, including cryptocurrencies seized by the government.
* Trump revoked a previous executive order calling for a government study on crypto assets and reducing risks.
Details:
President Donald Trump's executive action follows through on two promises made to the cryptocurrency industry. The order establishes a working group led by David Sacks, White House AI and crypto czar, to develop a federal regulatory framework for crypto markets.
The group will coordinate with the Treasury Department, SEC, and other financial regulatory agencies to identify and recommend changes to existing regulations and policies within 30 and 60 days, respectively. A report with legislative and regulatory proposals will be submitted to the President within 180 days.
The order does not authorize the immediate creation of a "strategic national bitcoin stockpile" as promised during Trump's 2024 campaign. However, it directs the working group to evaluate the potential creation of such a stockpile and propose criteria for its establishment. The scope of the stockpile may include cryptocurrencies other than just Bitcoin.
Trump also revoked a March 2022 executive order issued by President Joe Biden that called for a government study on digital assets. The new order encourages agencies to take strong steps to mitigate risks posed by crypto assets.
Market Reaction:
Following the signing of the executive action, Bitcoin (BTC) experienced a slight increase before falling back down. Some in the crypto market had anticipated more concrete measures, but Sean Farrell of Fundstrat highlighted the significance of the President's pro-crypto stance.
Trump has previously expressed his desire to make the United States the "crypto capital of the planet." Last Friday, his team launched official meme coins for President and First Lady Trump on the Solana blockchain.
Additional Developments:
* The Securities and Exchange Commission (SEC) recently rescinded SAB 121, an accounting guidance that hindered banks and broker-dealers from holding crypto on behalf of clients.
* Coinbase CEO Brian Armstrong has advocated for the creation of a strategic Bitcoin reserve by the US government.
* Senator Cynthia Lummis has proposed legislation to require the government to purchase more cryptocurrencies.
The Trump administration's positive stance on cryptocurrency is expected to lead to further developments in the regulatory landscape.