Since the November 2024 US presidential election, people have speculated about the impact that former President Donald Trump’s re-win could have on the US economy. Before President-elect Trump has even reached office, we have begun to see the impact of his election on the economy, not only of the United States but also of the world as a whole, in the form of the crypto market.
Roughly a month following the election, Bitcoin has reached an all-time high — even passing the critical milestone of reaching $100,000 in value. On his Truth Social platform, President-elect Donald Trump claimed credit for the surge in Bitcoin’s value, saying, “CONGRATULATIONS BITCOINERS!!! $100,000!!! YOU’RE WELCOME!!! Together, we will Make America Great Again!”
But just how much does Trump’s status as President-elect affect the cryptocurrency market?
President-elect Trump’s promises to the crypto industry
Many experts in the crypto industry agree that President-elect Trump’s position on cryptocurrency is promising for the market, especially compared to that of his predecessor, President Biden. During his campaign, President Trump made many promises about the crypto industry, and with Republicans regaining majority control of both the US Senate and House during the election, it seems that President Trump may be able to deliver on many of these promises.
“As we can already see with Bitcoin’s new all-time high, the perception is very positive, and the general investor’s perspective is that Trump’s shift to pro-crypto is genuine and not just a pre-election maneuver,” explains Patrick Gruhn, a founder of Perpetuals.com, an MIFID II Market Infrastructure startup for Crypto Derivatives trading. “Trump obviously learned about the crypto industry and revised his position as a skeptic to that of an explicit crypto advocate.”
Another of President-elect Trump’s promises that could significantly impact the crypto industry is his intention to cut interest rates. Of course, the President doesn’t control interest rates — the Federal Reserve does — but many of Trump’s policies could stimulate the economy in ways that will provide the conditions for the Federal Reserve to cut interest rates, which, in turn, makes it easier to borrow money and puts more money into the market.
“A lower interest rate in conjunction with more favorable crypto regulations in the US will likely drive more investors into crypto assets,” Gruhn predicts. “Generally lower interest rates alone are already positive for digital assets, and in combination with more legal certainty and more reasonable SEC enforcement actions allowing way more money to flow in the crypto industry, I think we see this right now already getting partially priced in as part of the current crypto price rally.”
President-elect Trump has also promised to make the United States a global hub for cryptocurrency, with suggested policies including a national crypto stockpile and bringing Bitcoin mining operations into the US. These policies would profoundly impact the Bitcoin sector — both in the United States and abroad — as they would significantly boost the legitimacy of this asset for both policymakers and the general public.
“If the US under Trump’s administration will change the policies and agency enforcement actions as it is currently anticipated, then this goal is really feasible,” asserts Gruhn. “Even though there is a lot of political competition like Europe’s MiCA regulation or the developments in the UAE, Singapore, and the UK, the US is better positioned than those regions because of its extremely well-experienced talent pool of developers, entrepreneurs, and investors.”
How changes in the US crypto landscape will affect the global market
Furthermore, President-elect Trump announced that he plans to nominate cryptocurrency advocate Paul Atkins as the next chair of the US Securities and Exchange Commission (SEC). Given that Atkins is well-known in the cryptocurrency industry to be opposed to excessive market regulation, his appointment could prove instrumental in President-elect Trump’s quest to make the US “the crypto capital of the planet.”
“The main issue for the US crypto industry was a hostile environment under the Biden administration, which made it very hard for the industry to grow,” Gruhn concludes. “For example, do SEC enforcement actions in the US — we have seen many in the last four years — also impact the growth of such businesses in other regions like Europe? After all, such an enforcement action will create additional scrutiny by European regulators and might at least delay or even prevent approval of licenses.”
Yet, while many of these policy changes are happening in the United States, we can expect them to have a massive global impact. After all, the rising price of Bitcoin has positive benefits not only for Americans but also for any trader involved in the crypto market anywhere in the world. Although Bitcoin is and will remain a volatile asset, these policies will facilitate the market in ways that should be encouraging to traders.
