Will Trump push for encryption legislation? It is rumored that he will solve the problem of de-banking and abolish SAB 121 accounting principles after taking office.

The Washington Post reported that Trump plans to sign an executive order on his first day in office, which may abolish the SEC's controversial "Crypto Accounting Bulletin (SAB 121)" and address the issue of banks excluding crypto companies, indicating his support for the crypto industry, and is expected to reduce regulatory burdens and improve the industry environment.

Trump Intends to Abolish SAB 121 and Resolve the "De-banking" Issue

The report indicates that the team of President-elect Trump, including his newly appointed "White House AI and Crypto Czar" David Sacks, have jointly developed a "legislative strategy" related to the crypto industry, which will be promoted and implemented after taking office.

(Trump Appoints Former NFL Player Hines, Former a16z Partner, and AI Crypto Czar Sacks to Collaborate, Focusing on the Future of AI and Crypto)

According to sources, Trump is expected to sign an executive order on his first day in office to address the current "de-banking" issue facing the crypto industry, and may also abolish the SEC's "Crypto Accounting Bulletin (Staff Accounting Bulletin 121, or SAB 121)".

However, this information has not yet been publicly confirmed by Trump's team.

Resolving the "De-banking" Issue

First, Trump's executive order will address the "de-banking" issue faced by crypto companies, which refers to the phenomenon where some financial institutions are pressured by the government to not provide services to crypto companies, deliberately excluding and weakening the industry.

(FDIC Crackdown on Crypto Industry Documents Exposed, Coinbase Legal Counsel Condemns: Utterly Shameful)

Although the Federal Deposit Insurance Corporation (FDIC) and the New York Department of Financial Services (NYDFS) have repeatedly denied these allegations, crypto industry participants generally feel that they are being deliberately excluded and weakened.

In this regard, the order will protect crypto companies' ability to use banking services normally, preventing the emergence of initiatives like Chokepoint 2.0 to suppress the crypto industry.

(US Federal Reserve Vice Chair Michael Barr Has Resigned! He Was Previously a "Driving Force Behind Crypto De-banking", Chokepoint 2.0 May Be Dismantled)

Abolishing SAB 121

Additionally, the executive order will also abolish the SEC's widely criticized SAB 121 regulation, which requires companies that custody crypto assets to record users' cryptocurrencies as liabilities on their balance sheets, which is believed to increase the accounting and financial burden on related companies and further worsen the cooperation between traditional finance and crypto companies.

Last year, Congress had attempted to abolish this guidance, with both the Senate and House passing the bill to overturn the regulation by overwhelming majorities, but the result was ultimately vetoed by President Biden.

(BNY Mellon Becomes the First Bank to Receive SEC Exemption from SAB 121: No Need to Include Crypto Assets in Financial Statements)

Expectations for Crypto-friendly Policies in the Trump Era

Trump's inauguration ceremony will be held in a week, and the general consensus is that his presidency will be more crypto-friendly, as he has nominated former SEC Commissioner Paul Atkins, who supports cryptocurrencies, to lead the SEC, and has selected David Sacks for a key position in the White House's crypto policy.

The planned executive order is seen as an important signal of the Trump administration's efforts to strengthen US crypto policy, and may also bring a more transparent and friendly regulatory environment for the industry. As Trump is about to take office, the market remains eager for the specific implementation of his crypto policies.