After Donald Trump's victory in the US presidential election, the cryptocurrency community is speculating about the fate of digital assets under his administration.
Industry experts and coin influencers have been vocal about how Trump's victory could change regulatory policies and market trends for cryptocurrencies. This comes after the former presidential candidate made cryptocurrencies a key part of his campaign, leading to a surge in popularity.
The Cryptocurrency Market Under the Trump Administration
Experts believe that Trump's crypto-friendly policies could create a more welcoming environment for BTC and other cryptocurrencies. His administration could also position the US as a leading cryptocurrency nation.
In a recent analysis on X (formerly Twitter), Alpha_Pls outlined a vision for cryptocurrencies under the Trump administration. A cryptocurrency research expert says a Republican government could fundamentally change the competitive landscape of the industry.
"BTC becomes a strategic reserve asset for the US," he proposed.
The analyst pointed out that such moves would signal to the global market that the US views BTC as an economic weapon. Alpha Please predicts this would set a precedent for other countries and grant unprecedented legitimacy to digital assets.
Another potential impact could be a complete overhaul of token classification, moving away from the current regulatory stance. This change could allow tokens to thrive without the legal entanglements currently hindering their development. It would also help US cryptocurrency firms gain a competitive edge in the global market.
Further reading: Cryptocurrency Regulation: What Are the Pros and Cons?
The popular voice on the X platform, Pahueg, also agrees. He says Trump's return could lead to a more favorable regulatory environment for Decentralized Finance (DeFi).
"DeFi will get better regulatory treatment — allowing things like fee switches and network-based dividends without harassment," he said.
This user also predicted the introduction of an Ethereum staking exchange-traded fund (ETF). In their opinion, this would spur interest in Ethereum-based products and trigger similar proposals in other blockchain protocols. It could also pave the way for a Solana ETF.
"The biggest Solana win under the new President Trump will be the long-awaited ETF we've been waiting for, likely in 2025 or 2026. Unsurprisingly, the stellar VanEck team will be leading the charge here, backed by 21Shares and Canary Capital," said Dan Jablonski, Growth Lead at news and research firm Syndica, in a post.
According to industry observers, the key to this new regulatory approach may include greater integration between the banking and cryptocurrency sectors. In this regard, Alpha_Pls foresees banks being able to freely provide services and custody assets to crypto startups, which was previously limited due to complex and restrictive compliance measures.
This could mark a transformative moment where banks can issue their own stablecoins. As a result, stablecoins as bank-branded digital currencies could gain prominence. This could increase accessibility to the cryptocurrency market and crypto-based financial products for US citizens.
America's Crypto-Friendly Shift and Its Global Impact
Not only the policy changes in the US, but Binance Research also pointed out that Trump's pro-business attitude could impact the global market, with increased cryptocurrency price volatility amid regulatory uncertainty.
"Trump's plans for deregulation, tax cuts, and increased government spending are expected to stimulate the economy," Binance Research said.
The research also emphasized that if Trump explicitly endorses cryptocurrencies, BTC and altcoins could reach new all-time highs. Trump's previous interactions with the cryptocurrency sector, such as his foray into Non-Fungible Tokens (NFTs) and connections to the NFT collection and DeFi platform World Liberty Financial, suggest the Trump administration may take a more pragmatic approach to digital assets than previous leadership.
Some speculate that this pragmatic perspective could propel the US to become a leader in cryptocurrency policy. This potential change is already reflected in the rallying stock futures and cryptocurrency markets, with BTC reaching a new all-time high amid the excitement over a Republican-led Washington. Trump's tax reforms and pro-business agenda could spur investment in both traditional and cryptocurrency markets. However, this could also lead to increased inflation, higher Treasury yields, and a strengthened dollar.
The cryptocurrency community's reaction to Trump's victory is not isolated. Pahueg jokingly mentioned that Dogecoin (DOGE) could become the official mascot of the US, a nod to Elon Musk's cultural influence on both Trump supporters and the tech industry.
This speculative mascot role symbolizes the lighthearted aspect of Trump's cryptocurrency policy and embraces meme culture. Meanwhile, the cryptocurrency community is closely monitoring the reaction of international investors to the Federal Open Market Committee (FOMC) and Trump's victory. According to BeInCrypto, the Federal Reserve's interest rate decision is scheduled for later today, and it is one of the major US macroeconomic events this week that will drive the Bitcoin sentiment. A dovish FOMC decision could lower interest rates and create a more crypto-friendly environment with smaller-than-expected cuts. Read more: How to Protect Yourself from Inflation Using Cryptocurrency. As the Trump administration prepares to move into the White House, cryptocurrency investors must be prepared for potential changes in the regulatory structure and market dynamics. Experts are cautiously optimistic that the new administration may open doors for the US cryptocurrency industry that were previously closed."Doge became the official mascot of the US as Elon became the de facto CTO of the White House. This will also impact memes," Pahueg said.
"As entrepreneurs' fears subside, innovation will increase," concluded Alpha_Plus.
