Impact of Donald Trump on the Cryptocurrency Sector
In the world of cryptocurrencies, the tenure of President Donald Trump has left a significant mark, reshaping the industry and regulatory future with landmark initiatives and legislation.
One of the most notable achievements is the signing of the GENIUS Act in July 2025, the first major federal law regulating stablecoins, a key class of cryptocurrency tokens. This law aims to create a comprehensive regulatory framework to protect consumers and the broader economy, while positioning the U.S. as a global leader in digital assets.
The GENIUS Act targets stablecoins to ensure their safety and transparency by instituting federal oversight and balancing state and federal law regimes. It is intended to reduce risks once posed by stablecoins while encouraging innovation and utilization in payment systems.
Upon taking office in January 2025 for his second administration, Trump revoked previous administration rules exploring a U.S. central bank digital currency (CBDC) and prohibited the creation of a federal CBDC altogether. Instead, he established the President’s Working Group on Digital Asset Markets to develop regulatory frameworks and promote the cryptocurrency industry.
The administration created a reserve of Bitcoin held by the U.S. Treasury from forfeitures, positioning Bitcoin as part of government assets, with restrictions on selling these reserves. The President’s Working Group has urged Congress to empower agencies like the Commodity Futures Trading Commission (CFTC) with authority over spot markets and recommended regulatory clarity to enable smoother trading and product development, including embracing decentralized finance (DeFi) innovations.
The vision of the administration is to make America a leader in digital assets, fostering growth while balancing consumer protections. This policy framework is considered the most comprehensive federal guiding document on digital asset market policy so far.
Reactions to these moves have been mixed. Supporters praise the legislation and regulatory clarity as essential to safe innovation and leadership in an increasingly important financial sector. Critics, however, raise concerns about potential conflicts of interest and the loosening of some investor protections under the Trump administration’s crypto agenda.
The cryptocurrency market is influenced by the stance of political leaders, such as President Donald Trump, on the industry. His inauguration was associated with Bitcoin hitting an all-time high of over $109,000. The crypto community is optimistic about having a powerful ally in the Oval Office with President Trump's influence.
However, skepticism remains about the practicality of integrating a national Bitcoin reserve into global finance. Many countries lack clear guidelines on how to define and regulate digital currencies. The value of the $TRUMP currency, launched by President Trump and First Lady Melania, has since plummeted.
Experts anticipate a more cohesive regulatory framework for the digital currency market by 2025, with Austin Campbell from NYU's business school and Jon Ostler, CEO of financial market site Finder, expecting federal legislation to bring clarity to the cryptocurrency industry. According to Jon Ostler, the value of cryptocurrency is heavily reliant on belief.
The potential impact of President Trump's policies on the cryptocurrency market is a topic of ongoing speculation. The uncertainty surrounding government regulations complicates the cryptocurrency landscape, but one thing is certain: the Trump administration has significantly shaped the future of the cryptocurrency market and regulation.
- The signing of the GENIUS Act in July 2025, a Federal law regulating stablecoins, indicates a shift in focus towards digital assets in the realm of finance and business, under the Trump administration.
- In the aftermath of the GENIUS Act, regulation of the cryptocurrency market is anticipated to become more streamlined by 2025, with an emphasis on promoting investor confidence and fostering innovation through technology, as per the recommendations of the President's Working Group on Digital Asset Markets.
