24th December 2024 > > The future for crypto regulation in the US.

tl;dr

Senior, influential positions within the incoming US administration all have one thing in common. Can you guess what that is?

Market Snap

Market Wrap

Three consecutive days of outflows from the spot BTC ETFs following Fed Chair Jerome Powell’s latest misguidance is having a predictable effect on the price of BTC. The euphoria following the US election results has tempered, whilst we wait to find out exactly what will happen in the US regulatory sphere next year. The signs so far are very positive – read on if you want to know more.

Curious Cryptos’ Commentary – Senate Banking Committee

You will recall that Chair of the Senate Banking Committee, Sherrod Brown, lost his seat in the recent elections due in part to the crypto industry making his local election a referendum on his personal antagonism towards cryptos:

https://www.curiouscryptos.com/post/8th-november-2024-us-politics-cryptos

Described as the “highlight of those elections” by none other than the CCC, we can now see the benefits to the crypto industry. The victor in the contest that put Brown firmly back into his place was Bernie Moreno. The new Senator for Ohio has been appointed to the Senate Banking Committee. This is undoubtedly a move calculated to really rub the salt into Brown’s festering wounds.

Bernie is a crypto advocate through and through, and will form a strong alliance with Senator Cynthia Lummis who has fought hard over the years for crypto rights. Earlier this year he set out his stall, by pledging he will “… lead the fight to defend crypto in the U.S. Senate”. Go Bernie!

The Senate Banking Committee has jurisdiction over both the Commodities Futures Trading Committee (CFTC) and our old enemy the Securities and Exchange Commission (SEC), still chaired by crypto-denier Gary Gensler, but only for another twenty-seven days and counting.

The era of regulation by enforcement is over, as the SEC makes a pivot into crypto-friendly policies that will help drive the US to become the standard bearer for the crypto revolution.

Curious Cryptos’ Commentary – The SEC

Paul Atkins, Patomak Global Partners Founder and CEO, has been nominated by Trump to chair the SEC.

Patomak is a consultancy firm “… specializing in strategy, risk management, and regulatory compliance” which has a number of crypto firms on its books. Paul will be keenly aware of the need to restructure the SEC, to return it to its core mission following Gensler’s illegal and unconstitutional overreach.

This does not imply a free-for-all in the regulatory sphere, quite the opposite. Paul will be uncompromising in his demands of the crypto industry. Crucially however, those demands will be transparent, and proportionate. Paul is likely to be an inspired pick to be SEC Chair.

Curious Cryptos’ Commentary – The CEA

Stephan Miran has been appointed to chair the Council of Economic Advisors (CEA).

The CEA is a body that advises the President on economic issues, a broad remit. Stephan has often been critical of the SEC under Gensler’s misguidance, and understands the need for clear and robust regulatory policies. He was also highly critical of Fed Chair Jerome Powell’s support for extra stimulus during lockdown, stimulus that was guaranteed to ignite inflationary pressures, and was therefore in direct opposition to Powell’s mandate, proving once again that the claim of central bank independence is a mere mirage, a fraud perpetrated upon us all.

Though cryptos form just a small part (for now) of the economic landscape, Stephen’s presence will ensure a higher profile for all things crypto.

Curious Cryptos’ Commentary – Presidential Council of Adviser for Digital Assets

Finally, this new body set up by Trump strongly suggests that his claim to be supportive of the crypto industry might very well be true, rather than just an election pitch to be ditched. Working closely with this council will be David Sacks in his role as “AI and Crypto Czar”:

"David will guide policy for the Administration in Artificial Intelligence and Cryptocurrency, two areas critical to the future of American competitiveness. David will focus on making America the clear global leader in both areas."

David previously worked at PayPal as COO, so has a close relationship with Elon Musk who is going to be very influential over the next four years.  He is also a co-founder of Craft Ventures which includes BitGo and Bitwise within its portfolio. Additionally, Craft Ventures was an early investor in decentralised crypto-currency exchange dYdX, of which I am personally a frequent user. David is no stranger to the crypto world.

2025 is shaping up to be the most consequential and exciting year so far for the crypto revolution.