Regulatory Shifts: US SEC's New Approach To Bitcoin Under Trump's Leadership

By Roshan Aslam

The Donald Trump administration has taken a vastly different stance on Bitcoin and other virtual digital assets, and the same is being reflected in the Securities and Exchange Commission. With Trump being headlined as a pro-Bitcoin President, especially with his campaign promises like creating Bitcoin Strategic Reserves coming into reality, the onus has fallen on the SEC to follow suit. However, regulations of VDAs, especially Bitcoin, have been a hotly contested topic around the world, and as Trump has hinted several times, the SEC is diverting its resources to reflect that of the federal administration.

Under the Trump administration, the US SEC has taken a vastly different stance from the Biden administration. For example, the SEC is diverting its resources away from lawsuits and investigations on businesses dealing with Bitcoin into enforcing regulatory measures that prioritise anti-fraud and securities protection. It has also been a prompt responder to Trump resuming his second term at the Oval Office by overhauling its department that oversees assets like Bitcoin. One of the most impactful of its actions has been introducing a new task force to develop a “comprehensive and clear regulatory framework”, about Bitcoin and similar assets, while rebranding its VDA investigations department to “Cyber and emerging technology unit”. 

The primary objective of this diversification of resources highlights the changing narrative at the SEC to Bitcoin and similar assets, as the agency aims to enable businesses with the “freedom to experiment and build interesting things,” as laid down by Hester Peirce, the current SEC chief. However, it is widely speculated that the SEC’s new stance highlights a far more nominal outlook that includes reduced scrutiny on Bitcoin and other VDAs, letting the space flourish within the US domestic borders — something that is not the case anywhere else in the world. 

Bitcoin Under Trump’s Leadership

One of the highlights of Donald Trump’s second term has been his proactiveness and long-term planning regarding Bitcoin and similar assets. From his campaign trail, Trump’s promises, like the creation of a Strategic Bitcoin Reserve, have become reality, and the broader market has responded accordingly.

Even if we set aside the dogmas of faith, the market showed following Trump’s election win, it becomes quite clear that what he has been more interested in has been to create and bolster the foundation for long-term asset value creation for Bitcoin and other relevant assets. While the tariff war has been a setback for traditional and new-age assets throughout the world, it is important to understand that it has created the necessary funnel system for enhanced Bitcoin adoption, as can be seen from market data since April 2. 

Additionally, Trump’s proactiveness and versatility in adopting Bitcoin as one of the most promising new-age assets have essentially reduced bureaucracy and state-sponsored rigidity in the space. This can be seen through the SEC moving back from numerous related lawsuits, instead focusing on regulations and regulatory frameworks to protect investor interest and portfolios in general. If we see the overall focus, Trump’s priority has been to enable businesses to innovate in the space, making Bitcoin the primary stakeholder. 

US SEC’s Stance

The highlight of the US SEC’s stance has been in its operational agility, primarily regarding its prior reputation as an anti-Bitcoin agency under the Biden administration. At present, the US SEC is more focused on creating a regulatory framework to promote ease of access, ease of business and investor security in VDAs. This notion is further bolstered by the SEC’s interim chairman Mark Uyeda’s statement recently, where he said that the agency is working to develop a long-term regulatory framework while stressing the need for a short-term ‘conditional exempt relief framework’ to drive innovation in blockchain.

Additionally, the SEC has been vocal that it is awaiting Congress to introduce a law regarding the VDA market, which will act as the foundation of rules & regulations for the long term. This law could be introduced by the end of 2025, speculations reveal, offering businesses greater transparency and ease of doing business. The SEC has also hosted several roundtables by inviting industry stakeholders to create a mutually satisfying landscape for frameworks, something that has been supported by Republicans’ goal of bringing conventional SEC regulations with the new-age scope of work in the VDA space under one unified umbrella.

The US SEC has also gone away from its reputation of starting litigations against businesses dealing with Bitcoin and the rest of the VDA space, an aspect that is widely believed to be one of the major factors for the US becoming a stagnant ground for innovations in Bitcoin. Trump’s pro-Bitcoin dynamics have been one of the catalysts for this change, including his rhetoric during the campaign period that he would be firing Gary Gensler, the erstwhile SEC Chair, when he assumed power. With Paul Atkins in the role now, Trump has managed to meet another one of his expectations and going away with Gensler is being dubbed a masterstroke for Bitcoin and related businesses to flourish in the US. At present, over 250 pro-crypto lawmakers occupy roles in Congress — another major fact that is driving Trump’s series of transformations for establishing Bitcoin as one of the most valued assets in the world, and the SEC’s apparent modernisation. 

Future Outlook

With the SEC being busy establishing a cyclical funnel to gather industry inputs, all eyes are now on Trump and Congress to understand how the regularisation of frameworks will take place in the coming months. On one hand, Trump is expected to continue his pro-Bitcoin stance that offers more clarity and ease of access to businesses. Congress lawmakers’ introduction of an uplifting and forward-looking law will enable not only American businesses in the space but also allow them to indulge in innovations related to blockchain and VDAs in general. As Bitcoin and other digital assets become mainstream with active government backing in the US, the role of the SEC will also be in focus to ensure seamless trading and continued investments in the years to come.

(The author is the Co- founder & CEO of GoSats)

Disclaimer: The opinions, beliefs, and views expressed by the various authors and forum participants on this website are personal and do not reflect the opinions, beliefs, and views of ABP Network Pvt. Ltd. Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Cryptocurrency is not a legal tender and is subject to market risks. Readers are advised to seek expert advice and read offer document(s) along with related important literature on the subject carefully before making any kind of investment whatsoever. Cryptocurrency market predictions are speculative and any investment made shall be at the sole cost and risk of the readers.

business