Donald Trump is officially the 47th president of the United States, and the US government is going in a few different directions since the last administration.
You’re reading State of Crypto, a Coindesk newsletter that discusses the intersection of cryptocurrency and government. Click here to register for future editions.
The narrative
US President Donald Trump was sworn in on Monday and quickly signed a flurry of executive orders. While it took him a few days to get to specific crypto articles, we have already seen a number of actions from his administration, not to mention the broader Republican Party.
Why does it matter?
The initial actions of these agencies and congressional bodies set the tone for what we can expect as the new Congress and Administration really get going this year.
Break down
There will be time to go into more detail on some of these later, but for now:
White House/Administration
Donald Trump signed a long-awaited executive order on crypto. Among its provisions there are elements that:
- Create a working group made up of Cabinet officials, White House advisers and others tasked with identifying regulations addressing crypto and recommending whether they be changed. AI and Crypto czar David Sacks will chair this working group.
- Task The working group with the evaluation of a reserve of digital assets.
- Ban any central bank digital currency, with a somewhat broad definition of a CBDC.
- Repeal former President Joe Biden’s executive order on Crypto, which mostly just directed his departments to produce reports on various aspects of crypto and consumer protections.
Trump also announced that Sacks would co-chair his President’s Council of Advisors on Science and Technology.
The US Securities and Exchange Commission, now operating under Acting Chairman Mark Uyeda, formed a crypto-focused task force headed by Commissioner Hester Peirce. Trump previously named Paul Atkins as his pick to serve as president of the agency, once he is confirmed by the Senate.
One of the SEC’s first moves was to terminate the staff of Accounting Bulletin 121, which directed publicly traded crypto companies to have their clients mark those holdings on their own balance sheets. SAB 121 was strongly opposed by the crypto industry, which argued that it made it difficult for banks to provide certain crypto services.
The Commodity Futures Trading Commission is now operating under acting chair Caroline Pham. PHAM named CFTC senior policy advisor Harry Jung as the regulator’s lead for crypto industry engagement. Trump has not yet named a candidate to take over as his permanent chair.
Trump pardoned Silk Road creator Ross Ulbricht, saying in social truth that he did so “in honor of [Ulbricht’s mother] and the libertarian movement, which supported me so strongly. “Ulbricht was convicted of criminal enterprises, narcotics distribution and several conspiracy charges and sentenced to double life in prison and 40 years without parole.
Trump announced that he would rename the existing US digital service as his department of government efficiency, the entity headed by Elon Musk (Vivek Ramaswamy, who was previously a head, has now left to run for governor of Ohio). Initially, the entity’s website just had the Dogecoin logo. Companies are also applying for ETFs from the Dogecoin Exchange now.
Trump spoke with El Salvador President Nayib Bukele shortly after signing his crypto executive order, although an official readout of the call did not mention Crypto in any way.
Senate
The Senate Banking Committee has confirmed the creation of a subcommittee focused on digital assets, led by Senator Cynthia Lummis (R-Wyo). The other members of the subcommittee include freshman Bernie Moreno (R-OHIO), who singled out former Sen. Sherrod Brown (D-Ohio) with a $40 million worth of support from the Crypto Fairshake Political Action Committee. , Ruben Gallego (D-Ariz.), who received $10 million in support and Dave McCormick (R-Pa.), among others.
The banking committee also holds a hearing on February 5, although the specific list and witness list have not yet been announced.
Senator Ted Cruz (R-Texas) introduced a joint Congressional Review Act resolution along with House Representative Mike Carey (R-Ohio) to repeal the recent IRS Crypto Broker Rule. The rule, finalized late last month, defines the term “broker” for IRS tax reporting purposes, but has already brought a lawsuit from the Blockchain Association. Industry lobbyists argue that the final rule “places illegal compliance burdens on software developers.”
Sen. Elizabeth Warren (D-Mass.), the new top Democrat on the Senate banking committee, is also calling on the U.S. Office of Government Ethics to investigate Trump’s token. He sent an open letter signed by Massachusetts Rep. Jake Auchincloss.
House of Representatives
The House Oversight Committee sent a letter announcing that it would investigate whether banks overflowed crypto companies at the government’s behest.
The House Financial Services Committee has already scheduled two hearings on Crypto next month. The first, on February 6, 2025, will focus on the aforementioned debate. The second, set for February 11, is titled “A Golden Age of Digital Assets: Charting a Path Forward.”
The top Democrat on the House oversight committee, Rep. Gerry Connelly, asked the panel’s top Republican, Rep. James Comer, to investigate Trump’s issuance of the Trump coin and its ties to World Liberty Financial.
Tuesday
- 16:00 UTC (9:00 am MT) The Tenth Circuit Court of Appeals heard ongoing arguments by Custody Bank against the Federal Reserve.
- (Sam Curry) Some security researchers discovered that they could track and control certain Subaru cars (i.e. those connected to the Internet). The vulnerability has been patched, according to the writer of this.
- (Bloomberg) Walgreens spent $200 million replacing refrigerator doors with screens whose supplier is now in a legal fight with the pharmacy/convenience store chain.
If you have any thoughts or questions about what I should discuss next week or any other feedback you would like to share, please feel free to email me at [email protected] or find me at bluesky @nikhileshde.bsky.social.
You can also join the group conversation on Telegram.
Look, next week!
