As Donald Trump embarks on a second term as U.S. President, the cryptocurrency industry is abuzz with anticipation, fueled by optimism for regulatory reforms and potential tax incentives. Having donated millions to Trump’s campaign, the sector now hopes for policies that could provide a significant boost to digital currencies.
The industry’s expectations center on a revamped Securities and Exchange Commission (SEC). Over the past four years, SEC Chair Gary Gensler’s tough stance on cryptocurrencies has been a major concern.
“He effectively thinks that every single crypto is a security, and he’s been aggressively going after products where he feels that they’re securities and they’re not being registered,” said Marlon Williams, founder of the Atlanta Blockchain Center, a startup incubator.
Last week, Gensler announced plans to step down in January, sparking hope among crypto advocates for a new chair with a less stringent approach. However, some economists remain cautious, warning that leniency could lead to a surge in fraudulent activity.
“The chances are excellent that a lot of people are going to lose a ton of their wealth as a result of this,” said Tom Smith, a professor at Emory University’s Goizueta Business School. “Then people will say, ‘What? Why wasn’t somebody looking out for me?’”
Crypto’s Mixed Track Record
Cryptocurrency’s rise has been accompanied by growing pains. According to the SEC’s Office of the Inspector General, 18% of all tips, complaints, and referrals to the agency in the past fiscal year were crypto-related, despite the sector comprising less than 1% of U.S. capital markets.
“A lot of investors were scammed by fake projects, fake founders, fake ideas, etc. There has been a lot of that in the space,” Williams acknowledged. “But there are a lot of good actors, especially in the United States, because they are aware of the hammer of the U.S. government.”
Georgia, a hub for crypto mining, has emerged as a focal point for industry growth. The energy-intensive process, involving warehouses of computers verifying transactions, has positioned the state as a leader in the field.
Tax lawyer Ida Bolt sees Trump’s second term as an opportunity for progress.
“He’s offering a lot of hope for innovation and a more hands-off regulatory approach,” Bolt said. “I think he wants to provide a lot of incentives for crypto companies to take root in the United States.”
A Shift in Trump’s Crypto Stance
Once a skeptic of digital currencies, Trump has embraced a pro-crypto platform, even dubbing himself a “cryptopresident.” His administration has hinted at federal and state-level tax incentives to encourage crypto mining and innovation.
Adding to the industry’s optimism, Trump Media and Technology Group, which operates his Truth Social platform, has reportedly made moves toward acquiring Bakkt, a Georgia-based cryptocurrency company formerly led by ex-Senator Kelly Loeffler.
Bitcoin values have surged since Trump’s return to the White House, underscoring the sector’s belief that his policies could usher in a new era of growth for the cryptocurrency landscape.
