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Bitcoin has bounced back to $94,000 following reports that Donald Trump is preparing to sign pro-crypto executive orders on his first day in office.
These orders could overturn key regulatory measures, including the SEC’s Staff Accounting Bulletin 121 (SAB 121).
Trump is Reportedly Preparing to Overhaul Crypto Regulations Starting Day One
According to The Washington Post reports, the orders are expected to address major challenges faced by the crypto industry, such as banking restrictions and the controversial SAB 121.
This SEC bulletin requires companies holding cryptocurrencies for clients to record those assets as liabilities on their balance sheets.
“The SEC has lifted SAB 121 on a case by case basis for big banks, but not widely enough. SEC Commissioner Hester Peirce told me that was a failure as it unfairly greenlit crypto custody for a select few. Biden’s veto against it aged poorly. Exciting times!,” wrote Zack Guzmán.
SAB 121 has been a focal point of industry criticism. Lawmakers attempted to repeal the guidance last year.
However, President Joe Biden vetoed the measure despite bipartisan support in Congress. Trump’s incoming administration is expected to revisit the matter immediately.
Currently, the SAB 121 policy makes holding crypto more expensive and risky for banks. So, they are less likely to offer crypto custody or other services to their customers.
“Congress passed the repeal last year, but Biden vetoed it. It’s the third of Saylor’s three catalysts for $5m BTC: ✅ Spot ETFs ✅ Fair value accounting ✅ Banks can custody Bitcoin (SAB 121 repeal),” wrote crypto entrepreneur Julian Fahrer.
Bitcoin and Crypto Markets Turn Green Again
Following the news, the crypto market showed strong recovery after initial dips earlier in the day. Bitcoin had dropped to $89,000, its lowest in two months. Since the news, BTC has climbed back to $94,500 at the time of reporting.
Also, Ethereum followed a similar trajectory, recovering from a dip below $3,000 to $3,100. AAVE, an altcoin linked to Trump-supported World Liberty Financial (WLFI), saw a 5% jump within an hour.
Furthermore, additional reports suggest that Trump’s executive orders may allow better banking access for crypto businesses. His orders will likely counter what industry leaders describe as “de-banking” practices.
FDIC Vice Chair Travis Hill recently condemned past banking restrictions on crypto firms. He called for clearer guidelines to support the industry.
At the same time, Trump’s team reportedly proposes restructuring the FDIC and merging banking regulators to improve efficiency.
Aside from these developments, there are also other pro-crypto developments to look forward to during inauguration day. David Sacks will assume the role of the first-ever Crypto Czar, and crypto-friendly former regulator Paul Atkins will lead the SEC.
Meanwhile, major crypto firms like Ripple, MoonPay, and Kraken have contributed significantly to Trump’s inauguration events. These donations could grant them early access to discussions with the administration regarding future crypto policies.
Overall, Trump’s inauguration, set for next week, is expected to mark a turning point for US crypto policy. The market, still reeling from earlier volatility, has taken the news as a sign of potential growth and stability under a more crypto-friendly presidency.