WASHINGTON (AP) — Bitcoin surged above $100,000 once again early Friday as the cryptocurrency industry anticipates swift action by Donald Trump once he assumes the presidency next week. Trump, a former skeptic who once dismissed bitcoin as a potential scam, has now embraced digital currencies with enthusiasm. He has launched a new cryptocurrency venture and pledged during his campaign to position the U.S. as the global “crypto capital.”
Trump’s proposed initiatives include establishing a U.S. cryptocurrency stockpile, implementing industry-friendly regulations, and appointing a crypto “czar” to oversee his administration’s crypto efforts. Speaking at a bitcoin conference last summer, Trump assured enthusiasts, “You’re going to be very happy with me.”
Bitcoin, created in 2009 as a decentralized form of electronic cash, has gained popularity over the years, moving from the fringes of finance to mainstream acceptance. Despite criticisms of its volatile nature and potential misuse by criminals, scammers, and rogue nations, cryptocurrencies have persisted and even thrived through market fluctuations.
The crypto industry, feeling targeted by the previous administration, rallied behind Trump in the last election, contributing to his victory. Following his win, bitcoin’s value soared, surpassing $100,000 for the first time before dipping to around $90,000 earlier this week. On Friday, bitcoin saw a 5% increase, reaching approximately $104,000, according to CoinDesk.
Trump’s cabinet and regulatory appointments signal strong support for cryptocurrencies, with key positions filled by crypto advocates. To celebrate what some are calling the first “crypto president,” industry leaders are hosting a sold-out event called the “Crypto Ball,” featuring top musical talent.
Trump’s early actions in office are expected to include the establishment of a special advisory council to shape clear and straightforward crypto regulations within the initial 100 days of his presidency. Tech executive David Sacks has been appointed as the administration’s crypto “czar,” with former congressional candidate Bo Hines leading the “Presidential Council of Advisers for Digital Assets.”
Trump has promised that regulations will be crafted by individuals who support the industry rather than hinder it. His pick to head the SEC, Paul Atkins, has been vocal in his support for cryptocurrencies. The industry hopes that under Trump’s leadership, innovation will flourish without the burdensome restrictions they faced under the previous administration.
Outgoing SEC Chairman Gary Gensler is at the center of attention in the cryptocurrency sphere. Peter Van Valkenburgh, the executive director of advocacy group Coin Center, expressed anticipation for a change in tone at the SEC under the upcoming Trump Administration. Gensler, who is on his way out as Trump assumes office, recently stated in an interview with Bloomberg that he takes pride in the SEC’s efforts to regulate the crypto industry, which he described as being “rife with bad actors.”
Furthermore, Trump has made pledges regarding the U.S. government’s handling of Bitcoin. He vowed to establish a Strategic Bitcoin Reserve, akin to the existing gold reserves. At a bitcoin conference held earlier in the year, Trump announced that the U.S. government plans to retain, rather than sell off, the substantial amount of bitcoin seized through law enforcement operations. A draft executive order has emerged online proposing the establishment of a “Strategic Bitcoin Reserve” as a “permanent national asset” to be overseen by the Treasury Department through the Exchange Stabilization Fund. The order specifies a target for the Treasury Department to accumulate a minimum of $21 billion worth of bitcoin.
Republican Senator Cynthia Lummis of Wyoming previously introduced legislation mandating the accumulation of bitcoin by the U.S. government. Advocates argue that this move would diversify government assets and provide a hedge against financial risks. However, critics raise concerns over bitcoin’s volatility, deeming it an unsuitable reserve asset.
Zack Shapiro, an attorney and head of policy at the Bitcoin Policy Institute, views the creation of a bitcoin stockpile as a significant step toward normalizing and legitimizing bitcoin in the eyes of skeptics. At the same bitcoin conference, Trump was met with enthusiastic applause when he reiterated his commitment to commuting the life sentence of Ross Ulbricht, the convicted founder of Silk Road, a dark web marketplace that facilitated transactions using cryptocurrencies. Ulbricht’s case has garnered support from crypto enthusiasts and Libertarian activists who believe that government authorities overstepped in prosecuting Silk Road.
In conclusion, the evolving landscape of cryptocurrency regulation under the leadership transition at the SEC and the proposed establishment of a Strategic Bitcoin Reserve by the U.S. government highlight the increasing prominence of digital assets in mainstream discussions. Trump’s initiatives regarding Bitcoin and the potential clemency for individuals like Ross Ulbricht underscore the complex intersection of technology, finance, and governance in the digital age.
