Preface

Recently, a draft of an "Executive Order Supporting Cryptocurrency" allegedly drafted by the Trump team has unexpectedly leaked, quickly causing a stir in the market. The draft proposes: in the future, the plan to include cryptocurrencies in the United States' strategic reserves may prioritize cryptocurrency projects that are established in the United States and supported by US institutions, such as XRP, SOL, and USDC. As soon as the news came out, XRP and SOL saw significant short-term increases, sparking heated market discussions.

It is worth noting that shortly after the exposure of this draft executive order, during Trump's inauguration, Trump himself also announced the issuance of a token called "TRUMP" on Twitter, promoting the "very special Trump community" and celebrating the "victory" of everything we represent. The market's interpretation of Trump's personal involvement in "issuing a token" is quite heated: some believe this is a signal of "deeper binding of politics and the crypto circle", while others question whether this will trigger wider regulatory controversies.

Reviewing Trump's repeated "open support" for cryptocurrencies during the election campaign, his proposed "Ten New Cryptocurrency Policies" also became an important factor in attracting a large number of crypto enthusiasts. Since his successful election, Trump has been step by step fulfilling his promises: for example, appointing Musk as the head of the "DOGE" government efficiency department, appointing David Sachs as the White House's cryptocurrency affairs officer, and appointing Paul Atkins as the new SEC chairman. These personnel changes strongly signal that the Trump 2.0 government is very likely to "fully embrace" cryptocurrencies at the policy level.

So, what specific content is included in the "Ten New Cryptocurrency Policies"? How do they coordinate with Trump's new personnel appointments? And what impact will they have on the cryptocurrency ecosystem in the United States and globally? This article will start from the current state of the US economy, analyze why Trump chose cryptocurrencies as a "breakthrough" under the pressure of trade deficits and debt crises, and explore the investment opportunities hidden in this wave of cryptocurrency globalization, providing readers with a more comprehensive "Trump Cryptocurrency Economic Framework" perspective.

(The following content is based on current public information, speculating and analyzing the political and cryptocurrency development in the United States around 2025, and is not an established fact.)

1. Trade Deficit + Debt Crisis

1.1 Starting from the "Reagan Cycle"

Source:MacroMicro.com

To understand Trump 2.0's preference for cryptocurrencies, we need to first review the "old problems" that have long existed in the US economic structure - trade deficits and debt crises.

After World War II, the United States, leveraging its advantages and strength as a victorious country, used the "Marshall Plan" to extensively inject the US dollar (then pegged to gold under the Bretton Woods system) into European countries, helping these war-torn economies rebuild and also firmly establishing the relationship between the US and its allies. However, as Europe gradually recovered, countries were unwilling to accept the fixed exchange rate system and began to exchange their US dollars for more value-preserving gold, leading to a continuous loss of US gold reserves. Eventually, in the 1970s, the US dollar was completely decoupled from gold.

During the Reagan era (the 1980s), to consolidate the hegemony of the US dollar, the United States adopted a policy of "significant tax cuts, increased defense spending, and high interest rates", creating a global US dollar circulation system, commonly known as the "Reagan Cycle":

1.High interest rates attract global capital inflows to the United States, with investors purchasing US debt and other US dollar assets to obtain high returns;

2.The large influx of capital leads to an appreciation of the US dollar, making US imports cheaper;

3.The rising prices of export goods lose competitiveness, and the trade deficit continues to widen;

4.These trading partners then recycle the acquired US dollars back to the United States by purchasing US Treasuries and other means, supporting the US fiscal deficit and consumption.

Source:HUATAI SECURITIES RESEARCH

This cycle has established the strong position of the US dollar in the international arena, but has also sown the seeds of continuously expanding trade deficits and US debt risks.

Source:Department of the Treasury

This cycle has lasted for nearly 50 years, and the rapid accumulation of federal debt, coupled with the rise in debt interest rates (relative to the past decade or so), has driven up the government's borrowing costs. In fact, as of December 2024, the interest payment on the national debt is higher than in previous years. Interest costs have already become the third largest expenditure category for the federal government, exceeding spending on Medicare, income security, Medicaid, and veterans' benefits and services.

Source: Department of the Treasury

1.2 China: The Largest Source of US Trade Deficits

Source:MacroMicro.com

According to the US Department of Commerce's statistics over the years, China is currently the largest source of the US trade deficit, and has thus become one of the largest creditors of the United States. Since 2018, Trump has launched a trade war with China, hoping to reduce the deficit by raising tariffs, but overall the United States still maintains a relatively high trade deficit. For the Trump administration in 2025, how to reduce the trade deficit remains a major issue.

"Two Axes" and "Seeking New Paths"

The Trump administration's main ideas for reducing the trade deficit are:

1.Expenditure reduction: Raise tariffs to reduce imports

2.Revenue increase: Increase exports

However, after implementing the tariff war, other countries will also impose higher tariffs on US products, which may be counterproductive. To this end, Trump 2.0 will still adopt "reducing corporate taxes" and other stimulative measures to attract manufacturing and service industries to return to the United States. But corporate tax cuts alone are not enough, and a new set of tools is needed to ensure that the production that returns to the United States can be smoothly exported.

This time, Trump has chosen cryptocurrencies.

2. "Ten New Cryptocurrency Policies": From Separation to Construction

From Trump 2.0's economic policies, it is not difficult to see his continuation of the "Reagan model": using some kind of US dollar substitute or US dollar external circulation tool to consolidate the United States' global financial position. The difference is that during the Reagan era, the US relied mainly on US Treasuries, while Trump is trying to create a new global economic cycle by vigorously promoting cryptocurrencies.

Reviewing the "Ten New Cryptocurrency Policies", they can be summarized into three main lines: "separation, development, and construction":

2.1 Separation

1. Stop the "crackdown" on cryptocurrencies

Within an hour of taking office, Trump immediately fired the previous SEC chairman Gary Gensler and appointed a more lenient regulator, ending the frequent enforcement actions against cryptocurrency companies, making the regulatory environment more friendly to blockchain enterprises.

2. Ending the illegal crackdown on the crypto industry in the US

Ending the illegal crackdown on the crypto industry in the US means that Trump may likely repealSAB 121 cryptocurrency accounting principles after taking office. SAB 121 is an accounting bulletin issued by the US Securities and Exchange Commission (SEC) in 2022, requiring institutions that custody crypto assets to record them as liabilities and record corresponding assets. In actual implementation, this is almost equivalent to "prohibiting banks from custodying cryptocurrencies" because the banking system finds it difficult to price and disclose according to this rule.

If SAB 121 is repealed, traditional US financial institutions can legitimately provide cryptocurrency custody services, providing users with a more convenient custody solution than hardware wallets and multi-signature wallets, and it also means that the barriers between traditional finance and cryptocurrencies will be broken down.

3.Preventing the development of central bank digital currencies (CBDC)

Trump has repeatedly stated that he will not allow the government to issue CBDC, believing that this will give the government too much financial control and infringe on personal privacy. On the contrary, he emphasizes the need to uphold the public's right to self-custody digital assets, and adhere to the principles of "decentralization" and "freedom".

4.Reducing the prison sentence of Silk Road founder Ross Ulbricht

Trump may "pardon" or significantly reduce the sentence of Ross Ulbricht, which is both a political gesture and a symbol of the re-recognition of the original "libertarian" values of cryptocurrencies. At the regulatory level, it may also provide more legal space for the private use of cryptocurrencies.

2.2 Development

1. Establishing a BTC strategic reserve

The Trump administration is inclined to transform the BTC currently held by the US (including the part confiscated by law enforcement) into a national strategic reserve, further solidifying the status of "BTC as digital gold". BTC has increasingly been seen by institutions and investors as an asset that can hedge against inflation and risk over the past decade. If a world power like the US officially includes BTC as a reserve, both allies and competitors may likely follow suit.

2. Preventing the government from selling BTC

In line with the "establishing a strategic reserve" call, Trump hopes to prevent the US government from selling its BTC holdings in the market, in order to stabilize the "official recognition" of BTC. This will undoubtedly become an important factor in pushing up the price of BTC.

3.Using cryptocurrencies to address debt issues

The US government may incorporate the confiscated BTC or other crypto assets into fiscal means to pay a portion of the interest on government debt, easing the government's debt burden. In 2024, the federal government's interest expenditure will exceed $880 billion (accounting for 3.1% of GDP). If digital assets like BTC can participate in fiscal operations, it means that cryptocurrencies have the opportunity to enter the realm of national-level fiscal tools.

Sources:Congressional Budget Office and Office of Management and Budget

3.3 Construction

1. Making the US a BTC mining powerhouse

By reducing energy costs, providing tax incentives, and other means, attract mining companies to set up operations in the US, in order to control a higher proportion of global BTC computing power.

2. Promoting the "21st Century Financial Innovation and Technology Act"

This act may clearly define the regulatory boundaries of the SEC and CFTC on cryptocurrencies, and strengthen information disclosure requirements. If Trump tends to classify most cryptocurrencies under CFTC jurisdiction, it means that more tokens will be identified as "commodities" rather than "securities". This will create convenience for US-based companies to issue tokens for overseas markets, and once the tokens are purchased by overseas users, it is equivalent to the US obtaining "export revenue", which can help reduce the trade deficit.

3.Accelerating the construction of a stablecoin system

The Trump administration plans to allow compliant stablecoin issuers to directly access the Federal Reserve payment system, achieving faster settlement and lower costs, further expanding the transaction advantages of the US dollar globally.

3. On the eve of taking office: Trump tweets a coin

On January 17, 2025, Trump announced the launch of a cryptocurrency called $TRUMP on his social media platform. The token price soared over 240 times in just 24 hours, with a total market capitalization skyrocketing from zero to $45 billion. Trump holds 80% of the token supply through his company CIC Digital LLC, meaning his personal net worth may increase by tens of billions of dollars. As we mentioned earlier, the US is facing challenges of trade deficits and government debt crises, so the US needs to "make its own money". Trump's token issuance provides a reference for Wall Street institutions, and also a reference for global financing institutions, as the efficient on-chain financing of web3 is officially challenging the traditional web2 financing methods. Combining the characteristics of the Trump 2.0 government, the future $TRUMP may be used as a planning tool for government finances or a buffer for US debt interest costs.

Sources:X

4. From Twitter to the White House: Building a Crypto and Tech Dual-Engine

In addition to the "Ten New Policies", Trump's personnel arrangements also send a lot of signals:

4.1 Establishing the D.O.G.E. (Government Efficiency Department)

On November 12, 2024, Trump announced the establishment of the "Government Efficiency Department" (D.O.G.E.), to be led by tech giant Musk and young politician Vivek Ramaswamy, aimed at reducing government bureaucracy, streamlining regulations, and cutting wasteful spending. Musk's love for DOGE is well known, fueling market speculation that "Dogecoin may receive special support".

4.2 Appointing David Sacks as White House AI and Cryptocurrency Affairs Coordinator

Sources:X

On December 5, 2024, Trump announced a major appointment on social media: former PayPal COO David Sacks will be responsible for the White House's AI and cryptocurrency affairs. Sacks is a long-time supporter of Solana and has also invested in the crypto fund Multicoin Capital, with close ties to Musk from their PayPal days. This move signals that the integration of the blockchain and AI industry chains will receive increased attention.

4.3 Paul Atkins appointed as SEC Chairman

Sources:X

On December 5, 2024, Trump formally nominated former SEC commissioner Paul Atkins to be the new SEC chairman. Atkins has a relatively open attitude towards digital assets and has long advocated for maintaining market transparency and protecting investors. The arrival of the new SEC chairman will undoubtedly further promote the compliance and institutionalization of cryptocurrencies.

5. The Convergence of Technology and Cryptocurrencies: Driving U.S. Exports

From these new appointments, we can see that Trump 2.0 attaches great importance to the integration of "blockchain + AI", which is directly related to the macro goal of increasing exports through "open source".

At the current stage, AI companies represented by OpenAI generally have the problems of high cost input and unclear profitability models. OpenAI's total revenue for the whole of 2024 was $4 billion, but in the end, it lost $5 billion. The main source of revenue is the monthly subscription fees of ChatGPT's paying users. Although the paid subscription revenue of ChatGPT has a certain scale, it is far from enough to cover the huge R&D and cloud computing costs.

If cryptocurrencies are introduced into their business model, for example:

1. Assuming that OpenAI issues its own tokens, users need to purchase these tokens to access AI services such as ChatGPT;

2. Global users need to exchange dollars or other fiat currencies to purchase tokens in order to use these services;

Once this model is widely implemented, each global token purchaser is equivalent to exporting services to the United States and paying "foreign exchange", thereby bypassing many tariff and regulatory barriers, and helping the United States form new digital product exports.

6. Unrestricted Global Trading of Crypto Assets: An Alternative Breakthrough Under De-globalization

In the current context of the rising anti-globalization trend, many countries (such as China and India) have strict foreign exchange controls, which pose significant obstacles to traditional foreign trade. The feature of cryptocurrencies is cross-border free circulation, without being restricted by the traditional SWIFT system or bank regulation. This natural advantage of "decentralized finance" has opened up new global trading channels for the Trump 2.0 government. With sufficient policy support, the first-mover advantage of the United States in the cryptocurrency field may be further expanded.

7. Investment Opportunities and Risk Warnings

7.1 Investment Opportunities

1. Focus on projects led by American teams or companies

The Trump administration is clearly inclined to support "Made in America" blockchain projects, such as XRP, SOL, and USDC. Related projects that can reach cooperation with the White House, consortia, and financial institutions may enjoy convenience in terms of regulation, compliance, and bank custody.

2. Pay attention to tokens included in Trump's "whitelist" (such as WLFI)

The DeFi project World Liberty Financial (WLFI) and its token list supported by the Trump family are also a potential track. However, it should be noted that such projects often have the risk of "policy bias", and if the political direction changes, the project may also face compliance risks.

7.2 Risk Warnings

Regulatory changes: Although Trump is in charge, there are still different interest groups in the U.S. Congress, Treasury Department, Federal Reserve, and Department of Justice, and policy advancement is not smooth sailing.

Market volatility: The cryptocurrency market has always been highly volatile, and any unexpected event (black swan or macro policy changes) can trigger a price crash.

8. Conclusion

Under the dual pressure of national debt and trade deficits, the United States urgently needs to expand its export-oriented income, and Trump 2.0's chosen "cryptocurrency overtaking" strategy is not only a new attempt at the integration of finance and technology, but may also become another weapon in its international financial game.

However, any grand plan faces real constraints: the political struggle within the United States and the vested interests of traditional financial institutions, the international community's vigilance against the "hegemony" of the United States, as well as the high risks and regulatory challenges of the cryptocurrency market itself, all add great uncertainty to this "cryptocurrency revolution". Regardless of the final outcome, the most important thing is - in this policy reshaping and technological change, maintain rationality, actively follow up on regulatory and information changes, so as to make wiser investment decisions in the midst of opportunities and risks.

Disclaimer: Readers are strictly required to comply with the laws and regulations of their respective jurisdictions, and this article does not constitute any investment advice.