Just a few months ago, Donald Trump pledged he wants to make America “the crypto capital of the world” during a speech at the Bitcoin 2024 conference in Nashville. This week he was elected president of the United States. The price of bitcoin reached a new all time high and crypto markets have been mostly green since the results were announced.
What are the implications for the industry? And what is the market telling us about who stands to benefit most? There are the top 3 promises, and potential implications.
U.S. Strategic Bitcoin Reserve
The most ambitious and consequential policy promise to date was the plan to create a Strategic Bitcoin Reserve in the U.S., unveiled at the Nashville Bitcoin Conference in July alongside Senator Cynthia Lummis. Senator Lummis reiterated her support for the bill on X the day after the election results were announced. The implications from this is that the U.S. would be investing in bitcoin as part of its reserves, cementing its status as a reserve asset in the world’s largest central bank. This would have serious ramifications in terms of Bitcoin’s perception.
While investment advisors such as Vanguard have opted not to support Bitcoin-related ETFs or products to date, investors could rightfully start asking why something that’s good enough for the U.S. government to own is not good enough for their portfolios. Should Trump’s administration follow through with this promise, the entire ecosystem of companies that support Bitcoin infrastructure could stand to benefit, driving volumes and price. Bitcoin made a new all-time high as election results confirmed a Trump victory, and closed the day +9%.
Support For The U.S. Bitcoin Mining Industry And DeFi
During his speech in Nashville this past July, Trump stated “If crypto is going to define the future, I want it to be mined, minted and made in the USA”. As part of the event, Trump met with top executives in some of the largest publicly traded bitcoin mining firms in North America. It’s key for U.S. miners to have a supportive regulatory framework, as they compete for power capacity with other industries, and like AI data centers, as well as other players on the city grids. The Valkyrie WAGMI Bitcoin miners ETF was up +17.79% the day after Trump’s victory was announced. If he keeps his promise, U.S.-based Bitcoin miners could stand to benefit.
In the same Nashville speech back in July, Trump promised to fire Securities And Exchange Commissioner Gary Gensler, with the goal of moving the SEC to a friendlier stance towards the industry. Companies that have a long standing history of legal battles with the SEC like Coinbase (+31.11%) soared on the news, and so did many of the most popular assets on its platform, like Dogecoin (+15.63%) and Solana (+12.07%). More regulatory clarity could benefit centralized and decentralized financial service providers, token issuers and exchanges.
Furthermore, Trump also supported the launch of a decentralized finance (DeFi) project, World Liberty Financial, just a few weeks ago. The token sale was only available to U.S. accredited investors, and foreign investors due to regulatory restrictions. So far, it has sold 1.02 B tokens from their projected 20 B sale. Making Trump acutely aware of how regulation impacts the industry.
Whether or not Trump keeps his promises remains to be seen. Some of them will require more political muscle and coordination than others. A good indicator will be whether or not he keeps his promise to pardon bitcoin folk hero and former Silk Road operator Ross Ulbricht during his first day in office.
