As 2024 draws to a close, the cryptocurrency industry finds itself at a crucial juncture. Following a tumultuous phase marked by significant regulatory challenges in the United States and the tail end of a bear market, the future looks brighter for crypto, with many experts predicting that 2025 could mark a pivotal year for the sector.
The important question now is: how will the upcoming Trump administration approach crypto? Following Donald Trump’s victory in November, crypto markets reacted positively, indicating a shift away from the previous government’s antagonistic stance toward digital assets. Observers agree that the era of relentless regulatory crackdowns may be ending, a development that many in the crypto world view as a significant turning point.
However, despite the initial optimism, industry advocates, such as Kristin Smith, CEO of the Blockchain Association, argue that simply halting hostilities won’t be enough. They stress the need for active policies that promote the long-term viability of cryptocurrencies. Trump’s track record on crypto during his campaign, filled with promises, might not directly translate into actionable policies once he takes office and faces myriad competing interests.
A notable development that could impact crypto policy is Trump’s decision to appoint a dedicated AI and crypto advisor, David Sacks. This role aims to streamline the administration’s vision for digital assets, which could facilitate progress in crypto regulation and growth.
One critical issue is the potential repeal of SAB 121, a regulation that currently inhibits banks from custodying crypto. If Trump were to sign a nullifying law passed by Congress—a move thwarted by President Biden’s recent veto—it could unlock a new era for crypto in the U.S., attracting more investment by allowing major financial institutions to interact with digital assets more freely.
While Bitcoin and Ethereum ETFs are now accessible on Wall Street, broader participation from traditional finance has remained limited due to regulatory uncertainties. Progress on policies that enable banks to hold crypto and formalizing a market structure would potentially reassure more investors, fostering a safer environment for both them and crypto developers.
The coming year holds significant promise for the cryptocurrency landscape, but it hinges on whether the new administration is willing to champion these needed changes. 2025 could either open floodgates for investment or leave the industry navigating a still uncertain regulatory framework.
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