During his first term in office, President Trump expressed skepticism about cryptocurrencies, saying that he was “not a fan” and that they were based on “thin air.” However, statements made during the campaign leading to his election on November 5, as well as his family’s involvement in the crypto space, indicate that the new Trump administration now holds a favorable stance toward the industry. The post-election rally in cryptocurrency markets certainly indicates that the industry believes that the incoming Trump administration will be pro-crypto.
In this post, we will explore what the future of cryptocurrency might look like under a Trump-led government, how regulatory changes could unfold, and the potential timeline for meaningful reform.
1. A Pro-Crypto Administration
Based on his campaign rhetoric and the Trump family’s increasing involvement in crypto, it appears that President Trump will be a more crypto-friendly president than his predecessor. For example, his policy proposals have included the following:
- Aggressively encouraging Bitcoin mining by having – in his words — “all the remaining Bitcoin to be MADE IN THE USA;”
- Creating a strategic Bitcoin reserve to eliminate the $35-plus trillion U.S. debt;
- Preventing the creation of a central bank digital currency; and
- Eliminating oppressive regulation in the crypto space by, in part, firing U.S. Securities and Exchange Commission Chair Gary Gensler “on day one.”
While not all campaign promises become reality, it is likely that the new Trump administration will take an aggressively supportive stance toward cryptocurrency.
2. The SEC Under Fire
On the campaign trail, President-elect Trump pledged to the industry that he will fire SEC Chair Gary Gensler “on day one.” We would expect that Trump will attempt to carry out this promise immediately.
Under Gensler, the SEC has classified many digital assets as securities and, as a result, brought and litigated multiple cases against major crypto exchanges, projects and developers for allegedly selling unregistered securities and other alleged violations. This has led to tension with the crypto industry, with complaints that the SEC is regulating the industry through enforcement, that the regulatory environment is not clear, and that these efforts have impeded innovation and development of the crypto economy.
Whether President Trump can actually or effectively fire Gensler immediately remains to be seen. Gensler’s term currently runs through June 5, 2026, and, having been appointed and confirmed by the Senate, he can only be fired for cause. But as p.resident in his first term, Trump demonstrated that he did not want to be bound by the niceties of the federal appointment process and would creatively work to achieve his ends.
3. Congressional Movement Towards Crypto-Friendly Legislation
The U.S. crypto industry has been pushing hard for regulatory clarity. While the executive branch can take significant steps to shape policy, legislative action will be crucial for ensuring the long-term stability and growth of the crypto industry.
During his presidential campaign, President Trump declared that he will be a pro-crypto president. But it is important to recognize that the crypto industry’s political efforts were not limited to the presidential race and, as a result, over 250 (self-proclaimed) “pro-crypto” candidates were elected to Congress.
Under a Trump-led government, we would expect to see a concerted effort from both the administration and Congress to pass legislation that recognizes cryptocurrency as a legitimate asset class and establishes clear rules for its use and taxation, building upon prior efforts such as the passage of the Financial Innovation and Technology for the 21st Century Act in May 2024 by the House. By highlighting the economic potential of crypto and the need for the U.S. to remain competitive in the global digital economy, the Trump administration could leverage the first truly pro-crypto Congress to pass crypto-friendly legislation that clarifies the legal framework for digital assets.
4. A 12-18 Month Timeline for Crypto Legitimization
Regardless of what happens with the SEC chair, if the Trump administration successfully drives legislative action, we could see significant changes within the next 12 to 18 months.
New legislation that brings regulatory clarity could create new opportunities in the following ways:
- Open the door for traditional financial institutions, including banks and large investment firms, to participate more actively in the crypto space. These institutions have largely been sidelined due to regulatory uncertainty and the risk of non-compliance with existing laws. Once a clear legal framework is established, these institutions would have more incentive to offer crypto-related products and services, such as custody, trading, and even crypto-based financial products;
- Retail investors could benefit from greater legitimacy and protections within the crypto market;
- It could lead to a surge in retail adoption, further driving the price and mainstream acceptance of digital assets; and
- Losses in crypto and blockchain development to Asian markets could be reversed and the U.S. could again become a haven for innovation in the crypto space.
Conclusion: Crypto’s Bright Future in a Trump Administration
In summary, a second term for Donald Trump could be a game-changer for the cryptocurrency industry in the U.S. With a pro-crypto stance, potential changes at the SEC, and the push for favorable legislation, the next 12 to 18 months could see crypto move from a fringe asset class to a mainstream financial tool. The Trump administration’s focus on deregulation and fostering innovation, combined with pressure from industry stakeholders and the broader financial sector, could help pave the way for a more robust and legitimate cryptocurrency market in the U.S.