Bitcoin Approaches Record High Amid Trump’s Push for Crypto Regulation Overhaul
Bitcoin, the world’s largest cryptocurrency, surged close to its record high on Tuesday after the new US Securities and Exchange Commission (SEC) announced plans to overhaul regulations surrounding the crypto sector.
Bitcoin reached a record high of $109,071 on Monday, coinciding with Donald Trump’s inauguration as president, a figure that was briefly overshadowed by disappointment when crypto was not mentioned in Trump’s initial executive actions on Day One. However, the market began to recover, with Bitcoin prices jumping by 3.8%, while Ethereum (the second-largest cryptocurrency) gained 1.4%.
The SEC’s announcement to form a new task force aimed at creating a regulatory framework for digital assets marked the first major step of Trump’s administration to address the rapidly growing cryptocurrency market.
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Paul Grewal, Chief Legal Officer of Coinbase, expressed optimism, noting, “The president has moved quickly on his agenda. The SEC has made it clear they understand that and want to be a part of that.”
While the move was welcomed by some, Geoffrey Kendrick, the global head of digital assets research at Standard Chartered, cautioned that volatility would persist until specific rules were unveiled. “The digital asset market is disappointed not to have been mentioned in the inauguration speech or Day One executive orders,” Kendrick said. “I believe Bitcoin will fall unless Trump makes any announcements regarding digital assets. A drop back below $100,000 appears unavoidable.”
Trump’s crypto-related initiatives have drawn significant attention, including the launch of his $TRUMP-branded meme coin on Friday, which fell on Tuesday, according to CoinMarketCap. Another of Trump’s crypto ventures, World Liberty Financial, announced completing an initial token sale of $300 million on Monday. While Trump has pledged to delegate asset management to his children, his cryptocurrency ventures have raised ethical concerns and conflict of interest issues, according to critics.
Mark Uyeda, acting SEC chair, revealed on Tuesday that his office’s task force will focus on establishing clear regulatory guidelines, creating registration pathways, enhancing disclosure requirements, and deploying enforcement resources. Reuters previously reported that Uyeda and Republican Commissioner Hester Peirce were preparing to launch a cryptocurrency policy change in alignment with Trump’s agenda.
Industry insiders expect additional regulatory measures to be announced soon. Jeremy Allaire, CEO of Circle, a stablecoin issuer, discussed these expectations at the World Economic Forum in Davos, predicting imminent executive orders that would allow banks to trade cryptocurrency, offer crypto investments to wealthy clients, and hold it in portfolios.
With these moves, Trump’s administration is positioning itself to make significant shifts in the crypto regulatory landscape, but how these developments will impact the volatile market remains to be seen.
