What Trump’s Election Really Means For Crypto? #CriptoNews

With Donald Trump’s return to the White House, the crypto landscape could be on the cusp of a major transformation. Trump’s pro-Bitcoin stance, commitment to reforming crypto regulations, and vocal opposition to Central Bank Digital Currencies suggest that U.S. crypto leadership may strengthen significantly in the coming years.

A Strong Push For Bitcoin

Throughout his campaign, Trump has openly supported Bitcoin, aiming to make the United States the “crypto capital of the planet.” He even proposed integrating Bitcoin into the nation’s financial strategy by creating a national Bitcoin reserve. This pro-Bitcoin stance aligns with Trump’s view that the U.S. should lead in digital finance.

Big Firms Primed for Gains

Despite years of political and regulatory challenges, the U.S. remains a powerhouse for crypto-focused businesses, driving significant economic impact. Leading players like BlackRock and Fidelity are pioneering tokenized funds, while VISA and Mastercard offer credit cards linked to crypto wallets, demonstrating mainstream adoption. The U.S. cryptocurrency exchange Coinbase, with $4.3 billion in revenue in the first three quarters of 2024, underscores the industry’s scale. In Q2 2024 alone, stablecoins transacted $8.5 trillion—outpacing Visa’s $3.9 trillion—lead partly by U.S.-based issuers like Circle, Paxos, and PayPal. This leadership highlights the high stakes for regulatory clarity.

Crypto Regulatory Clarity

Under Trump, the regulatory landscape could undergo significant changes. Trump has pledged to dismantle what he views as restrictive regulations, beginning with the dismissal of SEC Chairman Gary Gensler, whom he blames for the “regulation by enforcement” approach. Trump could establish more straightforward, growth-oriented policies by appointing a more crypto-friendly SEC leader. Christopher Perkins, President of the New York-based crypto investment firm CoinFund, highlights the momentum, noting, “The elections in the U.S. were wildly positive for the crypto industry. While Trump has indicated he will be a crypto President, it’s important to note that 261 pro-crypto candidates were elected to Congress. This is the first ‘crypto’ Congress.” Perkins emphasizes, “We expect regulatory clarity, but not overly prescriptive regulation,” describing the outlook as “very bullish for the crypto industry—full stop.”

CBDC Efforts Called into Question

Trump’s opposition to central bank digital currencies (CBDCs) is clearly rooted in privacy and individual freedom concerns. He supported the CBDC Anti-Surveillance State Act, which prevents the Federal Reserve from issuing a CBDC without congressional approval—a stance echoed by Fed Chair Jerome Powell. Trump’s anti-CBDC position could also influence global trends significantly as central banks like the European Central Bank move forward with their digital currencies. The ECB’s planned CBDC designed to provide accessible, standardized payments across the eurozone, has thus far received limited political attention in Europe, despite concerns over its potential to crowd out the private sector. However, Jonas Gross, Chairman of the Digital Euro Association, believes Trump’s vocal stance could shift this: “If Trump is outspoken against CBDCs, we may see more discussions within the European Parliament,” he suggests, indicating that Trump’s influence may prompt increased scrutiny of the ECB’s approach.

Global Competition Heats Up

Europe has led the way in crypto regulation, with the Markets in Crypto-Assets Regulation (MiCAR) set to take effect by year’s end. Joachim Schwerin, Principal Economist at the European Commission, notes that Europe’s regulatory path reflects its commitment to “balanced, sustainable growth for crypto,” a stance that has already attracted leading U.S. crypto firms seeking European MiCAR licenses. While Trump’s re-election may create a more crypto-friendly regulatory environment in the U.S., Schwerin believes Europe’s approach will remain steady. However, he acknowledges that global competition is heating up, with nations like the Emirates and Switzerland establishing robust frameworks to attract crypto innovation.

Trump’s Election Marks New Crypto Era

Despite past regulatory challenges, the U.S. has built a strong crypto sector, with major U.S. players driving growth and innovation. Trump’s election could unlock even greater potential by establishing supportive crypto regulation. With a pro-crypto Congress and supportive regulators, the U.S. could strengthen its lead and emerge as the world’s primary hub for decentralized finance. Trump’s anti-CBDC stance may also shape global discussions, prompting central banks to reconsider centralized models. Together, these shifts could position America as a leader in digital finance, navigating a competitive landscape where Europe has already laid significant regulatory groundwork.

Yet, as Rhys Bidder, Deputy Director at the Qatar Centre for Global Banking and Finance, observes, “There have been false dawns for crypto before… the hope must be that the industry builds in a sustainable manner.” With this new U.S. administration, crypto has a unique opportunity to prove itself as a mature and credible sector, dispelling doubts and moving beyond its volatile past.