WASHINGTON, Jan 17 (Reuters) – President-elect Donald Trump intends to leverage his executive powers to reduce the regulatory obstacles faced by cryptocurrency companies, aiming to foster greater adoption of digital assets within the initial days of his administration, according to three sources familiar with the plan.
Having courted cryptocurrency investors and supporters during the campaign, promising to be a “crypto president,” Trump is expected to sign an executive order establishing a crypto advisory council. This mirrors an idea he first proposed in July, two sources revealed, speaking under the condition of anonymity to discuss internal deliberations. Bloomberg News initially reported on Thursday that Trump planned to issue this executive order to create a crypto council designed to advise the government on pro-crypto policies. This council could potentially consist of up to 20 members, one source indicated.
Additionally, Trump’s advisors have discussed the possibility of another executive order directing the Securities and Exchange Commission (SEC) to overturn the 2022 accounting guidance known as “SAB 121.” Critics argue that this guidance has made it overly expensive for some companies, especially banks, to hold cryptocurrencies on behalf of their clients.
Trump is also anticipated to order an end to “Operation Choke Point 2.0,” a term used by crypto executives to describe what they view as a coordinated effort by bank regulators to restrict crypto companies’ access to the traditional financial system by discouraging banks from providing services to them. Bank regulators deny such efforts.
Reuters was unable to confirm whether Trump would implement these changes through one or several executive orders. However, sources stated that the primary goal is to swiftly signal the administration’s firm backing of digital asset adoption. If implemented by the appropriate regulatory bodies, these policy directives could significantly propel cryptocurrencies into mainstream use, according to regulatory and crypto experts.
This stance sharply contrasts with President Joe Biden’s regulators, who, with the aim of protecting Americans from fraud and money laundering, have taken a tougher approach to crypto companies, filing lawsuits against exchanges such as Coinbase, Binance, and Kraken, alongside others in federal court.
Critics of the cryptocurrency industry often point to the failures of prominent crypto executives, such as Sam Bankman-Fried, who received a 25-year sentence for fraud, and Binance founder Changpeng Zhao, briefly jailed for money laundering violations, as indications of the industry’s potential dangers.
A representative for Trump, who has several crypto advocates among his financial backers and potential cabinet picks, did not immediately respond to a request for comment. The SEC also did not respond immediately to a request for comment.
Cryptocurrency regulation is one of multiple subjects that Trump is expected to address with executive orders at the start of his second term. His incoming team has promised numerous executive orders on a variety of topics, including the regulation of energy production and illegal immigration.
