Decoding the White House Digital Assets Report: The "Bible" of Crypto Regulation, Embracing DeFi and Innovative Financial Products
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Decoding the White House Digital Assets Report: The "Bible" of Crypto Regulation, Embracing DeFi and Innovative Financial Products
This "bible" may have laid the framework for future crypto regulation.
Navigating Web3 tides with focused insightsCompiled by: Felix, PANews
Since President Donald Trump called in January this year for the establishment of a Digital Assets Markets Working Group and the submission of a report outlining recommendations on a digital asset regulatory framework, this report has been highly anticipated. Some in the crypto community even claimed it would become the industry's "regulatory bible" or guide.
Now, this "regulatory bible" has finally been released. The administration led by President Donald Trump issued its most detailed digital assets policy report to date on Wednesday (July 30). At 166 pages long, the report mentions cryptocurrency 391 times, Bitcoin 130 times, DeFi 32 times, and Ethereum 28 times.
The report outlines a broad regulatory roadmap for cryptocurrencies, offering policy recommendations across multiple crypto-related areas. These can be categorized into five main pillars:
1. Positioning the United States as a Leader in Digital Asset Markets
The working group recommends that Congress enact the following legislation, building upon the bipartisan House passage of the CLARITY Act:
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Authorize the CFTC to regulate spot markets for non-security digital assets, eliminating existing regulatory gaps.
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Embrace DeFi technology and recognize its potential for integration into mainstream finance.
The SEC and CFTC should use their existing authority to:
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Immediately initiate digital asset trading at the federal level and clarify registration, custody, trading, and recordkeeping requirements for market participants.
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Use tools such as safe harbors and regulatory sandboxes to allow innovative financial products to benefit consumers without bureaucratic delays.
2. Modernizing Digital Asset Banking Regulation
The report states that the Trump administration has fully terminated Operation Choke Point 2.0 and is committed to ending regulatory practices that deny banking services to the digital asset industry. The working group recommends regulators take the following additional steps:
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Restart cryptocurrency innovation initiatives and clearly define permissible bank activities in custody, tokenization, stablecoin issuance, and blockchain applications.
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Increase transparency in the process for institutions to obtain bank charters or Federal Reserve master accounts.
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Ensure bank capital rules align with the actual risks of digital assets, not merely their existence on distributed ledgers.
3. Strengthening the U.S. Dollar
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The Treasury and banking agencies should faithfully and swiftly implement the GENIUS Act.
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Congress should take further action by passing the Anti-Central Bank Digital Currency Surveillance State Act, codifying the president’s executive order banning a U.S. central bank digital currency to protect privacy and civil liberties.
4. Combating Illicit Finance in the Digital Age
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The Treasury and relevant regulators should clarify obligations and reporting under the Bank Secrecy Act (BSA).
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Congress should emphasize the importance of self-custody and clarify anti-money laundering (AML) and countering the financing of terrorism (CFT) obligations for participants in DeFi ecosystems.
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Regulators should work to prevent abuse of authority against lawful activities of compliant citizens and protect individual privacy.
5. Ensuring Fairness and Predictability in Digital Asset Taxation
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The Treasury and IRS should issue guidance on topics including CAMT (PANews note: Corporate Alternative Minimum Tax), wrapped transactions, and de minimis income from digital assets to reduce taxpayer burdens.
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The Treasury and IRS should review previously issued guidance on tax treatment of activities such as mining and staking.
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Congress should pass legislation classifying digital assets as a new asset class, modifying federal income tax rules applicable to securities or commodities, and adding digital assets to the list of assets subject to wash sale rules.
Following the report’s release, the industry broadly viewed it as a positive signal of the direction of Trump’s crypto agenda.
Ji Kim, CEO of the Crypto Council for Innovation, stated: “The release of the President’s Working Group report on digital assets marks a unified government effort to ensure America remains at the forefront of the golden age of crypto. From DeFi, tokenization, market structure, CIF, taxation, and more—the report covers it all. We now have clear regulatory guardrails to ensure continued growth.”
Rebecca Rettig, Legal at Jito Labs, also offered praise after the report’s release, noting: “While there is still much work to do, this excellent roadmap provides real guidance toward achieving regulatory clarity for the U.S. crypto industry.”
However, it is worth noting that while the report represents a “major win” for the crypto industry, for those closely watching these policies, the report revealed no new initiatives nor provided deep explanations of specific measures, leaving several unresolved questions—including those related to the future scale of a federal government cryptocurrency reserve. An official said at a press briefing that the report focuses on regulatory frameworks rather than reserves, and that more information should be released soon.
Additionally, the report acknowledges that Congress has not yet passed a market structure bill, which imposes significant constraints on the industry. Such legislation would establish a more comprehensive regulatory regime for cryptocurrency issuance and the operations of exchanges like Coinbase. Although the report encourages the SEC and CFTC to provide clearer guidance on key functions such as registration, custody, and trading, many market participants will remain in a state of uncertainty while Congress continues debating legislation.
While this report may fall short of some expectations, perhaps—as U.S. officials put it—“they’ve laid a solid foundation for building this house.”
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