The 119th session of the US Congress has begun and the digital assets industry is hoping that there will soon be favorable and clear regulatory guardrails for the cryptocurrency and stablecoin markets.
During his campaign, President-elect Donald Trump promised transform the United States intocrypto capital of the planet,” and, according to the nonprofit industry group Stick with crypto2024 elections saw 250 “pro-crypto” members of Congress elected with 16 “pro-crypto” senators.
While the scene seems be settled for a sea of regulatory changewith crypto supporters placed at the head of Securities and Exchange Commission, Department of Commerce and more, a fundamental gap remains: the reality policy currently being writtensponsored and referred to the appropriate authorities Home Or Senate committee.
Once the new administration is sworn in, there will be three key elements to watch, including the potential creation of a national reserve for bitcoins; clarity as to whether the SEC or Commodity Futures Trading Commission has jurisdiction over which elements of the industry; and clarity around stablecoins, including their issuance.
The previous administration’s policy revolved around two bills: one on stable coins and the other on digital assets market structure – none of whom managed to get out of his second room exams.
Read also: Bears, Bulls and Regulations Shape Crypto Aspirations for 2025
Crypto-Friendly Federal Initiatives Proposed by the 47th Administration
Although the newly elected legislature may lean in favor of crypto, solving crypto-related issues will require collaboration between Congress, regulatory agencies, and industry stakeholders.
For legislators and regulators, the task is difficult. Can Washington craft a coherent regulatory framework that promotes growth without stifling creativity? Will a balance be struck between protecting consumers and allowing crypto companies to innovate? These questions require more than theoretical answers; they call for action.
The regulatory landscape for cryptocurrencies is as fragmented as blockchain itself. Depending on who you ask, Bitcoin and Ethereum are either commodities overseen by the CFTC or securities under the SEC. Smaller tokens face even more obscure classifications, leaving crypto companies trapped in a minefield of legal uncertainty.
For startups, the stakes are existential. A token classified as a security triggers strict registration and reporting requirements, while commodities face fewer hurdles. This inconsistency can often drive innovation overseas.
Despite the Urgency to Explicitly Delineate SEC and CFTC Oversight crypto marketsgiven the rise in power stable coinsit is likely that stablecoin legislation could come first. Republicans and Democrats on the House Financial Services Committee nearly reached a compromise last year, and Europe was the first major economy to adopt a crypto licensing framework, Cryptoasset markets (MiCA), which also explicitly dealt with stablecoins.
Marta Belcherpresident of the Filecoin Foundationexplained that one of the biggest debates is whether stable coins must be backed by US dollars, arguing that this requirement would be “beyond” what is requested from other sectors.
See also: Court documents show regulator’s crypto freeze was more of a warning than a ban
A national Bitcoin reserve: dream or necessity?
Perhaps the most ambitious idea to be floated is the creation of a national bitcoin reserve. According to Trump advisers, the proposal would involve retaining all current Bitcoins held by the government and accumulating more to strengthen the country’s crypto assets. This would position the United States as one of the largest sovereign countries bitcoin holdersthereby increasing global confidence in its leadership in the crypto market.
Even if the idea gains traction, its implementation would require unprecedented collaboration between Congress, the Federal ReserveAnd Cash. This is probably far from the case, but in a world where central banks are experimenting with digital currenciesnothing is out of the question.
At the same time, it is likely that the new administration will be more inclined to oppose the creation of new regulations and in favor of greater clarity around the areas in which the crypto industry can operate.
“We signed more American offers during the last six weeks of 2024 (since the elections) than the previous six MONTHS”, Ripple CEO Brad Garlinghouse ” wrote this week in an article on the social platform ‘administration.
“For Ripple, this is even more personal after (Securities and Exchange Commission Chairman Gary) Gensler’s SEC effectively froze our business opportunities here at home for years,” Garlinghouse added.
Ultimately, legislators tend to move much more slowly than innovation.
Yet cryptography doesn’t fit neatly into existing frameworks, and that’s the root of the problem. Trump’s position could attract capital and talent to the United States, but without proper oversight, the even Policies promising growth can also expose the market to risks.
