The future of America’s crypto industry will largely depend on the outcome of November’s presidential election. At the 2024 Bitcoin Conference in Nashville, Tennessee, former President Donald Trump outlined his ambitious vision for making America the “crypto capital of the planet and the Bitcoin superpower of the world.”
In addition to its symbolic significance, Trump’s appearance at the conference and his pro-crypto plan are historic firsts among major presidential candidates. Trump’s plan includes establishing a Strategic National Bitcoin Stockpile, appointing a crypto-friendly regulatory board, firing Securities and Exchange Commission Chairman Gary Gensler, and ending the Biden-Harris administration’s “anti-crypto crusade.”
In stark contrast to the Biden-Harris administration’s approach toward cryptocurrency, Trump’s platform would invigorate the crypto industry and promote its growth.
The current hostility toward cryptocurrency has been spearheaded by SEC Chairman Gensler, a Biden-Harris administration appointee. The SEC, under Gensler’s leadership, brought a record number of enforcement actions against crypto industry players in 2023 and imposed $281 million in penalties from settlements in 2023 alone. The SEC has imposed a staggering $2.89 billion in penalties on the crypto industry through the end of 2023.
Gensler has aggressively targeted cryptocurrency industry stakeholders and companies, all the while failing to provide clear regulatory guidance for the crypto industry. Much of the SEC’s enforcement actions center on the question of whether cryptocurrency is a “security” under U.S. law (based on the Howey test).
No Explicit SEC Regulation
Despite Gensler’s belief that cryptocurrencies should be regulated as securities, there is no explicit SEC regulation or statute confirming this stance. In fact, multiple judges have criticized the SEC for its failure to provide clear guidance. A notable example occurred in an SEC action against Binance, where U.S. District Court Judge Amy Berman Jackson questioned the SEC’s piecemeal approach, asking, “Where’s the SEC been? … Why are we doing this on a coin-by-coin, case-by-case, judge-by-judge litigation … as opposed to issuing a reg that tells everybody ‘this is it?’”
The crypto industry’s disdain for Gensler was palpable at the 2024 Bitcoin Conference. In his speech, Trump pledged to fire Gensler on “day one.” The crowd burst into applause. The applause was so loud that Trump repeated the refrain, resulting in even bigger applause and chants of “Trump! Trump! Trump!”
National Stockpile, Regulatory Board
Along with replacing Gensler, Trump laid out his plan to establish a Strategic National Bitcoin Stockpile, which would entail the federal government creating a substantial reserve of Bitcoin through acquisition and the accumulation and retention of Bitcoin through legal seizures. By acquiring and holding Bitcoin in reserves, the U.S. could be protected against potential cryptocurrency volatility, while establishing the U.S. as a leading force in the international Bitcoin market.
Trump also plans to tap crypto-friendly advisers to serve on a crypto regulatory board. The board will be tasked with drafting and implementing transparent regulations tailored to the crypto industry. By selecting members who are knowledgeable and supportive of digital assets, Trump’s regulatory board would stand in stark contrast to the current SEC’s aggressive regulation-through-enforcement regime.
Vance’s Stance
Trump’s pro-crypto platform is already manifesting into action. In May 2024, Trump became the first major presidential party candidate to begin accepting donations in cryptocurrency. Additionally, Trump’s selection of Sen. J.D. Vance, R-Ohio, a cryptocurrency proponent, as his running mate also reinforced the ticket’s commitment to supporting the crypto industry. Vance’s 2022 financial disclosures included Bitcoin holdings between $100,001 and $250,000.
If Trump’s plans take effect, they could provide much-needed stability and growth to the crypto industry, which has been stunted by regulatory uncertainty and aggressive enforcement under the Biden-Harris regime. And the crypto industry may not need to wait long for these changes to materialize. As Trump stated at the Bitcoin conference on Saturday, “The moment I’m sworn in, the persecution stops and the weaponization ends against your industry, and as long as I’m in the Oval Office.”
Oliver Roberts is an associate at the law firm Holtzman Vogel, where Jonathan Fahey is partner.
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