Cryptocurrency sector awaits its golden age with Trump’s return to the White House: why?

The return of Donald Trump to the White House is a blessing for many players in the cryptocurrency sector, who hope that the United States will reposition itself in this global market. The Republican candidate, previously very opposed to this technology, promised in July to make his country “the world capital of cryptocurrencies.”

Support groups close to digital currencies raised some $245 million during the presidential campaign, according to the Federal Election Commission (FEC), most of it intended to attack Democrats who oppose the development of this technology. According to The Washington Post, the Republican magnate began looking for profiles of pro-cryptocurrency collaborators for key positions in his future government as soon as he was elected.

Some members of his team have the mission of studying this world of numerical currencies to better understand their regulatory expectations, the newspaper noted.

The prospect of a new Trump presidency launched bitcoin, the most popular of the cryptocurrencies, into orbit, which last week set a new price record as it approached $93,500 and appreciated by 35%.

Trump plans to remove from office the president of the financial markets regulator (SEC), Gary Gensler, a critic of the sector. Without clear regulations, this former banker chose a repressive approach to cryptocurrencies, whose operation he intends to regulate as classic financial products. The SEC thus brought three of the largest exchange platforms to justice: Binance, Coinbase and Kraken, as well as some start-ups.

“The absence of clear rules not only stifled innovation, but also led companies” in the sector “to countries with more transparent legislation”considered Katherine Snow, legal manager of Thesis, which develops applications based on bitcoin.

A bill now in the hands of the Senate provides that another regulator, the CFTC, will deal with the sector with a more pragmatic and less dogmatic perspective. This regulatory change could “accelerate the approval of new investment products” and “increase the flow of capital” to the digital currency ecosystem, said Simon Peters, an analyst at eToro.

Chandra Duggirala, head of the Tides.Network incubator, hopes for a break with the policy of Joe Biden’s government, seen as “unfavorable for cryptocurrencies in the United States.” In particular, this executive pointed out the pressure on traditional banks to dissuade them from collaborating with “blockchain” entrepreneurs, the base technology of digital currencies.

“We would like talented people to not be intimidated by joining this industry.“said Burnt Banksy, founder of the Xion platform. Often stigmatized, or presented as a refuge for speculators and even criminals, the world of alternative currencies hopes to normalize its existence with Donald Trump in the White House.

Michael Cahill of Douro Labs, a financial data specialist, believes in Trump’s commitment to this market because he “launched his own projects” in this field. In September, The millionaire and his three children partnered with several industry leaders to launch World Liberty Financial, a cryptocurrency placement and lending platform.

This situation raises questions about possible conflicts of interest, since favorable measures for cryptocurrencies directly benefit this venture of which the president-elect is a part. For the managers of the Coinhouse platform, the Trump government should encourage payments in “stablecoins”, cryptocurrencies indexed to other currencies, most often to the dollar, which greatly limits their volatility.

The legitimization of cryptocurrencies would also benefit the establishment of national reserves of bitcoins, an alternative mentioned in July by Donald Trump.

According to Simon Peters, the government already has about 210,000 bitcoins, essentially coming from seizures in court cases, which represents about $18 billion.

This weekend, the country hosted dozens of bitcoin holders, entrepreneurs and crypto asset enthusiasts, mainly foreigners, at the Adopting Bitcoin 2024 conference.

“Now that Trump has won the Presidency, this has been reflected. Bitcoin has risen, we have surpassed the record price we had“bitcoiner Moisés Clarós, who is also part of Bit-Driver, the first Salvadoran company to accept the cryptocurrency for taxi service, told EFE. He added that “this year we will reach $100,000” and “when Trump takes power, “I know bitcoin will grow even more.”

In September 2021, El Salvador became the first country in the world to adopt bitcoin as legal tender, along with the US dollar, and the purchase of a daily bitcoin was announced, with 5,932 bitcoins.

Bitcoin is rising along with the automaker Elon Musk,
Tesla, which has risen almost 40% since the voting results were known, as investors believe Trump’s friends and interests will do well while he is in office.