By Gram Slattery, Chris Prentice and Jarrett Renshaw
WASHINGTON (Reuters) – President-elect Donald Trump is planning to use his executive powers to reduce the regulatory burden faced by cryptocurrency companies and promote digital asset adoption in his first few days in office, according to three people briefed on the plan.
Trump, who courted crypto cash on the campaign trail with promises to be a “crypto president,” is expected to sign an executive order creating a crypto advisory council, an idea he first floated in July, said two of the sources who requested anonymity to discuss private deliberations.
Bloomberg News first reported on Thursday that Trump was planning to issue an executive order creating a crypto council, which would help advise the government on crypto-friendly policy. It could have as many as 20 members, according to one of the sources.
Trump’s advisers have also discussed using an executive order to direct the Securities and Exchange Commission to rescind 2022 accounting guidance known as “SAB 121” that has made it too costly for some companies, particularly banks, to hold cryptocurrencies on behalf of third parties, the people said.
Trump is also expected to order the end of “Operation Choke Point 2.0,” the term crypto executives use to describe what they say has been a concerted effort by bank regulators to choke crypto companies out of the traditional financial system by directing banks to deny them services.
Bank regulators deny that such an effort exists.
Reuters could not ascertain if Trump would direct the changes via one or several executive orders, but sources said the goal was to quickly send a strong signal that the new administration broadly supports digital asset adoption.
If implemented by the relevant regulators, Trump’s expected policy directives have the potential to push cryptocurrencies into the mainstream, say regulatory and crypto experts.
That is in stark contrast to President Joe Biden’s regulators which, in a bid to protect Americans from fraud and money laundering, cracked down on crypto companies, suing exchanges Coinbase (NASDAQ:), Binance, Kraken and dozens more in federal court.
Critics of the cryptocurrency industry point to the downfall of leading crypto executives Sam Bankman-Fried, who was sentenced to 25 years for fraud, and Binance founder Changpeng Zhao, who briefly went to prison for money laundering violations, as evidence of the industry’s dangers.
A representative for Trump, who counts multiple crypto advocates among his financial backers and top cabinet picks, did not immediately respond to a request for comment. The SEC did not respond immediately to a request for comment.
Cryptocurrency regulation is just one of several topics that Trump is expected to address with executive orders in the opening days of his second four-year term.
The incoming president’s team has promised dozens of executives orders on topics ranging from energy production to illegal immigration.
