Economic Vision/Changes in US Cryptocurrency Regulation\Shen Jianguang

  Considering that among the Trump administration's cabinet members in the United States, more than 10 core members are cryptocurrency-friendly, and both the House of Representatives and the Senate are dominated by Republicans, it is expected that Trump's "New Cryptocurrency Deal" will be implemented and finalized as soon as possible.   Putting the US cryptocurrency market on a path of rapid growth.

  The Trump administration's "Strengthening U.S. The establishment of the President's Digital Asset Markets Working Group within the National Economic Council, led by the Special Adviser on Artificial Intelligence and Cryptography and comprising the Secretary of the Treasury and the Chairman of the Exchange Commission (S.C.C.C.), is required for "Leadership in Digital Financial Technology." Chairman), the CFC Chairman, and the C.O.C.C. Trading Commission), Assistant to the President for National Economic Policy, Assistant to the President for Science and Technology, Homeland Security Advisor, etc., who will help reach consensus on defining cryptocurrency attributes, regulatory division of labor, and policy tone.

  Republicans control both the United States in Congress. Senate and House of Representatives, further reducing the unpredictability of regulatory bill introduction. More importantly, the Senate Banking Committee, the Senate Agriculture Committee, the House Financial Services Committee, and the House Agriculture Committee are currently forming a two-member committee to lead legislative work on cryptocurrency regulation that "intends to foster a new era of legislation with 21st century financial innovations and state-of-the-art legislation."

In terms of timing, Trump's executive order requires the Treasury Department, Justice Department, SEC and other relevant agencies to identify all regulations, guidance documents, orders or other plans affecting the digital asset field within 30 days of issuance.

 The latest situation is that on February 5th at the White House, the Director of Artificial Intelligence and Cryptocurrency, David.   At the first press conference on digital assets led by Sacks, Senate Banking Committee Chairman Tim.   Scott said he planned to pass the bills through the Senate within 100 days "as aggressively as possible."

 Although it is difficult to determine the specific announcement time of the Cryptocurrency Regulatory Bill as a whole ("21st Century Financial Innovation and Technology Act") and the Stablecoin Regulatory Bill, it is very likely that they will be introduced in 2025.

 In his executive order "Strengthening American Leadership in Digital Financial Technology," Trump made it clear that the overall tone of the new administration's cryptocurrency and stablecoin regulatory policies is to support responsible growth.   In addition, the "21st Century Financial Innovation and Technology Act" pursues a smart and comprehensive regulatory policy, encourages "responsible financial innovation", and provides more space for the innovation and development of the encryption industry.

 The "Genius Act" aims to "create a secure and pro-growth regulatory framework to unleash the potential for innovation" and further Trump's promise to make the US "the cryptocurrency capital of the world."   On February 5, the SEC reduced the size of the task force responsible for cryptocurrency enforcement to reduce oversight of cryptocurrency and other digital assets.

The US leads the global cryptocurrency market in terms of share and influence.    According to data from Chainalysis, from July 2023 to June 2024, the inflow of cryptocurrency funds in the United States reached nearly 900 billion US dollars, far ahead of other countries and regions.    The penetration rate of cryptocurrency holders—the ratio of holders to the total population—is as high as 15.6%, which is significantly higher than the global average of 6.8%. In addition, there will be approximately 53 million holders of cryptocurrencies in the United States in 2023. This leading position is largely due to the United States' enormous wealth, large population, developed capital markets, the US dollar's global reserve currency status, and a thriving innovation ecosystem.

  Meanwhile, US dominance of the cryptocurrency market is largely driven by institutional activity.    From July 2023 to June 2024, through the United States, nearly 70% of cryptocurrency activity in North America was transfers of more than $1 million, reflecting the growing influence of major U.S. financial institutions in the cryptocurrency market.    In 2024, the United States will introduce cryptocurrency exchange-traded funds (ETFs), fueling the enthusiasm of financial institutions such as Goldman Sachs, Fidelity and BlackRock all actively deploying cryptocurrency.

  With the accelerated formulation of US cryptocurrency regulatory policies and the Trump administration's policy of actively encouraging responsible innovation, more companies and investors will be attracted to enter the market.    With more institutional participation, capital influx and innovative startups, the development of the US cryptocurrency market will enter a fast lane, and its share and dominance in the global cryptocurrency market will further increase.

  A series of policy changes since Trump came to power shows that while the United States has banned central bank development of digital currencies, he has turned the development of stablecoins and crypto-assets into a national strategy, and the regulatory policy of cryptocurrencies has also returned to the central line of "supporting modern development".    As the largest and most influential country in the global cryptocurrency market, changes in policy direction in the United States will undoubtedly trigger policy adjustments in other countries around the world.    Currently, the European Union, the United Kingdom, Japan, Singapore, the United Arab Emirates and other countries and regions have created or are creating regulatory policies for stablecoins and cryptocurrencies, the main idea being to support innovative development based on clear regulatory requirements.    Against this backdrop, China is advised to pay close attention and undertake a comprehensive review.