Where will the crypto industry go next after Trump won the election?
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Where will the crypto industry go next after Trump won the election?
As Republicans potentially gain control of the presidency, Senate, and House, the cryptocurrency community's optimism is rising over Trump's previous promises to deliver swift action.
Navigating Web3 tides with focused insightsAuthor: James Hunt
Translation: Baicai Blockchain
With the U.S. presidential election concluded and Donald Trump emerging victorious, what changes lie ahead for the cryptocurrency industry?
During this year's campaign, Trump adopted a newly pro-crypto stance, elevating crypto policy to a key platform issue and making a series of promises. These include firing SEC Chair Gary Gensler on "day one," commuting the sentence of Silk Road founder Ross Ulbricht, establishing a Presidential Cryptocurrency Advisory Committee, repealing SAB 121, ending "Operation Choke Point 2.0," turning the U.S. into a Bitcoin mining "superpower," and creating a national strategic Bitcoin reserve.
With Republicans potentially controlling the presidency, Senate, and House of Representatives, optimism is growing within the crypto community that these promises could be swiftly fulfilled.
1. A New SEC Chair
During the Biden administration, the Securities and Exchange Commission (SEC) played a central role in regulating cryptocurrencies. Current Chair Gary Gensler has maintained that most digital assets are securities and has urged companies to register under existing rules. The agency has also pursued legal actions against major industry players such as Coinbase, Binance, Kraken, and Robinhood, as well as projects in DeFi, NFTs, and stablecoins.
While Gensler may choose to remain as an SEC commissioner under a Trump administration, reports suggest he is likely to step down.
Speculation is rife over who will succeed him. Many expect Trump to appoint current Republican SEC Commissioner Hester Peirce, widely known as "Crypto Mom" for her supportive views on digital assets. Peirce has long criticized the SEC’s enforcement-heavy approach and its refusal to approve spot crypto products before bringing lawsuits. However, she has previously stated she is uninterested in becoming chair, making fellow Republican commissioner Mark Uyeda a leading contender—he too holds favorable views toward crypto. Alternatively, Trump could nominate an entirely new commissioner. Analysts have pointed to former CFTC Chair Chris Giancarlo as a potential candidate.
Jake Chervinsky, chief legal officer at Variant Fund, said Peirce becoming chair is unlikely because she appears uninterested in the role. He noted: "Uyeda has a decent chance, but I expect Trump may prefer to appoint someone of his own choosing." He added: "In reality, being chair is an extremely difficult and thankless job. Some commissioners (like Uyeda) might be interested, while others may feel they’ve done their part and want to pursue new opportunities."
Still, with over two months before Trump officially takes office, regulatory shifts could occur before new leadership assumes control of federal agencies. Chervinsky warned that during this interim period, the current administration might "rush to finalize rules and launch enforcement actions."
He said: "Trump’s top crypto policy priority must be ending Biden’s attempt to suppress the industry through enforcement. That means halting the SEC’s unreasonable enforcement actions and dropping the DOJ’s case against Tornado Cash."
2. Pro-Crypto Regulation
One of the most anticipated policies under a Trump administration is advancing the Bitcoin Act—legislation that would establish Bitcoin as a strategic reserve asset, with plans for the U.S. government to hold up to 5% of the total Bitcoin supply (21 million coins). Officially titled the "Innovation, Technology, and Competitiveness Act of 2024 via National Optimization of Investment," it is commonly referred to as the "Bitcoin Act of 2024." It was introduced in July by Republican Senator Cynthia Lummis of Wyoming.
Following the election results, with Donald Trump winning the presidency and Republicans regaining control of the Senate and likely maintaining the House, Lummis posted on X: "We will build a strategic Bitcoin reserve."
Analysts Peter Chung and Min Jung from Presto explained: "If Republicans achieve full control of the presidency, Senate, and House, the chances of passing numerous crypto-related bills—including Lummis’s strategic Bitcoin reserve proposal—will significantly increase."
At the 2024 Bitcoin Conference in Nashville this summer, Travis Kling, chief investment officer at Ikigai, expressed skepticism about the plan. "It sounded like an insurmountable gap—almost too optimistic to believe. But with the strong Republican victory, the likelihood has risen dramatically. If it actually happens, then WAGMI."
James Butterfill, research director at CoinShares, wrote Wednesday that such a move would elevate Bitcoin to a status similar to gold, integrating it into national reserves and marking a historic step toward legitimacy. He said: "If the Bitcoin Act passes, it could greatly boost institutional and governmental interest in Bitcoin, accelerate its growth, and push its value to new highs."
Analysts at Bernstein Research and brokerage firm noted that Trump’s victory has shifted the regulatory climate for crypto from headwinds to tailwinds. They expect the Senate Banking Committee to become more crypto-friendly, accelerating progress on other legislation—particularly around stablecoins and market structure—benefiting U.S.-based exchanges and stablecoin issuers like Circle and Paxos.
Matt Hougan, chief investment officer at Bitwise, highlighted that among Trump’s other commitments, ending "Operation Choke Point 2.0" would ease restrictions preventing crypto firms from accessing traditional banking services. Additionally, repealing the controversial SEC staff accounting bulletin SAB 121 could open the door for traditional banks to accept more crypto companies as clients and even hold and custody Bitcoin themselves.
However, one constant post-election remains America’s $36 trillion deficit, which grows by $1 trillion every 100 days. Hougan noted that according to projections from the Congressional Budget Office, this trend may continue—or worsen—under Trump’s policies. With potential Federal Reserve rate cuts and ongoing economic uncertainty, Bitcoin is poised to become a "must-have" asset for investors.
3. Bitcoin Mining Incentives and Releasing Ross Ulbricht
Incentives for U.S. Bitcoin miners could further solidify the dominance and consolidation trends among domestic publicly traded operators. This may impact how the industry diversifies into areas like AI data center hosting amid challenging conditions following the halving.
Finally, one of Trump’s most popular pledges among both the crypto community and the broader public may be commuting the sentence and releasing Ross Ulbricht after taking office. Ulbricht received a life sentence without parole for creating and operating the darknet marketplace Silk Road, a website deeply intertwined with Bitcoin’s early history.
Early crypto advocate Amir Taaki quickly reminded President-elect Trump on Wednesday to honor his promise and commute Ulbricht’s sentence, urging his immediate release. Taaki said: "I owe everything to Ross Ulbricht. Crypto changed my life. The growth of cryptocurrency would not have been possible without his contributions. He made the ultimate sacrifice, and we all benefit from his work."
4. Market Impact
CoinShares’ Butterfill pointed out that Trump’s proposal to appoint billionaire supporter Elon Musk to lead a new "Department of Government Efficiency," tasked with cutting approximately $2 trillion in federal spending, implies future monetary policy may become looser to offset fiscal tightening. Historically, loose monetary policy combined with fiscal conservatism benefits Bitcoin, enhancing its appeal as a hedge against currency devaluation and inflation, attracting investors seeking to avoid traditional economic risks.
Valentin Fournier, analyst at BRN, said: "Trump’s victory provides strong bullish momentum for markets. Anticipated rate cuts and global stimulus measures are expected to further boost the economy and support Bitcoin’s performance. Although Trump won’t officially take office until January next year, we expect Bitcoin to maintain strength through year-end." He added: "Ethereum has risen 20% over the past three days, slightly narrowing its gap with Bitcoin after underperforming earlier. However, we view this rally as temporary, and Bitcoin is likely to resume leadership in the coming weeks."
According to The Block’s price page, Bitcoin is currently trading at $74,967, up 1.7% over the past 24 hours and 77.4% year-to-date. In contrast, Ethereum is trading at $2,818, up 7.6% over the past day. However, its year-to-date gain stands at 23.7%, underperforming other crypto assets.
Ryan Lee, chief analyst at Bitget Research, said: "With Trump re-elected, the initial market reaction may involve fear-driven inflows from sidelines, pushing Bitcoin to new highs. In the coming days, BTC ETFs may see net inflows, signaling Wall Street institutions are optimistic about the outlook. The futures market’s long-to-short ratio is below 1, indicating institutional investors in crypto are taking long positions via futures. The market is now in a broadly bullish phase."
Bernstein analysts reaffirmed their forecast Wednesday, expecting Bitcoin to approach $90,000 by year-end and reach a bull-market target of $200,000 in 2025. Bitwise’s Hougan shares similar price expectations.
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