The price of Bitcoin, the most popular cryptocurrency in the world, recently crossed USD 100,000. This landmark moment may signal the arrival of cryptocurrencies in mainstream awareness and culture. One of the driving factors that caused this surge in Bitcoin’s valuation has been Donald Trump becoming the president-elect of the United States.
He has taken a favourable stance on crypto, which is likely to lead to positive crypto trends and a Trump crypto boom. He has indicated that if elected to office, he will lower regulatory hurdles for cryptocurrency companies and encourage digital asset adoption.
With ownership down to 26% in 2024, what’s next for crypto in Singapore?
Let’s look at how Trump’s presidency will likely impact the crypto industry in APAC and the world.
Trump’s stance on cryptocurrency
Trump is likely to be the most pro-cryptocurrency American president. He has championed the industry in several ways throughout the election. He also has personal wealth at stake, which is likely to grow if the sector performs well.
One of the first areas in which he is likely to focus is to roll back regulatory oversight over the industry. The previous US government implemented several rules to try to prevent money laundering and fraud. However, these rules will likely either be rolled back or remain unimplemented.
The second way Trump will likely boost the industry is by accepting crypto as part of the Government’s reserve currency. This move will not only increase demand, which will drive up prices but will also provide significant legitimacy to the industry.
Further, Trump will have the support of several Republican members of Congress who also share his stance on crypto. This development is likely to help Trump push his new policies through the legislature without significant resistance.
Policy changes expected under Trump’s presidency
Under the previous Biden administration, both the US Securities and Exchange Commission (SEC) and the Treasury deemed the cryptocurrency industry to be rife with issues. The agencies clamped down on money laundering and fraudulent practices in an effort to bring a largely unregulated space under control. However, this is likely to change under Trump.
The new administration looks set to push through an overarching legislation to govern the crypto industry.
We may see different rules and regulations for different actors within the industry. For example, exchanges that enable crypto trading may attract special regulations for operation. The SEC is likely to introduce tailored rules that recognise the differences between how traditional securities and the blockchain work.
Furthermore, Trump has promised that he will create a crypto advisory council. This agency is likely to spearhead the Government’s role in the industry. Questions about who will lead such an agency are already floating around. The new SEC chair is also likely to favour crypto and its mainstream adoption. An increasing number of “crypto-friendly” picks may be used to shape policy over the next four years.
The way forward
The official endorsement of the US government and the subsequent mainstream adoption of crypto could have ripple effects worldwide. Currently, regulatory frameworks within APAC countries are largely nonexistent in line with much of the rest of the world.
However, this attitude could change if the industry gets the backing of the US government. Further, with crypto valuations nearing all-time highs, many investors and traders in Southeast Asia may prefer a more favourable government stance towards these digital assets.
Singapore leads the charge in crypto uptake in the region, but with smartphone penetration in countries such as the Philippines, Thailand, and Indonesia high, there is much growth potential. This should lead to several new entrants to the cryptocurrency market due to the significant growth in crypto valuations over the past few months. Eventually, a conducive environment could lead to sustained adoption rates for not only cryptocurrencies but decentralised finance (DeFi) as a whole.
Southeast Asian countries may find an unexpected use for cryptocurrencies. While smartphone and internet penetration is high in the region, many families lack access to traditional finance. One of the ways that increasing cryptocurrency adoption can help is by providing access to financial services in previously unserved areas.
Overall, Trump’s administration will likely push for higher adoption levels of cryptocurrencies. This may have a snowball effect on the rest of the world and can mean that the sector finally enters the mainstream.
However, significant work still needs to be done before cryptocurrencies become more than a speculative asset. The current high levels of volatility and lack of proper regulations mean that the technology may still be unsuitable for widespread use.
The crypto industry in APAC is keeping pace with the rest of the world. New developments within the industry, positive crypto trends, and increased safety levels may help convince governments that cryptocurrencies are here to stay. The next step may be full-fledged regulation for the industry as part of the Trump crypto boom.