The focus is on strengthening US leadership in crypto tech

On January 23, 2025, President Trump issued an executive order titled “Strengthening American Leadership in Digital Financial Technology.”  The EO  supports the responsible growth and use of digital assets, blockchain technology, and related technologies across all sectors of the economy in order to secure America’s position as the world’s leader in the digital asset economy, driving innovation and economic opportunity.

The EO sets out high-level policy objectives:

• Protecting the lawful use of blockchain networks, participation in mining and validation, and self-custody of digital assets without unlawful censorship; Promoting dollar-backed stablecoins; Prohibiting central bank digital currencies; Ensuring fair and open access to banking services;
• Providing “regulatory clarity” for digital assets based on “well-defined jurisdictional regulatory boundaries”  by establishing a Working Group on Digital Asset Markets to be chaired by White House AI & Crypto Czar David Sacks, who shared his opinions here.  The Working Group will include the Chairman of the Securities and Exchange Commission, the Chairman of the Commodity Futures Trading Commission, the Attorney General, and the Secretary of the Treasury, among seven other top officials who will: (1)  identify regulations, guidance documents, and orders pertaining to the digital asset industry within 30 days, (2) submit recommendations regarding rescission, modification, or regulatory adoption of those items within 60 days, and (3) submit a report to President Trump recommending regulatory and legislative proposals to establish a Federal framework for the issuance and operation of digital assets, including stablecoins, and evaluate the potential creation and maintenance of a national digital asset stockpile.

William Quigley, a cryptocurrency and blockchain investor and co-founder of WAX.io blockchain and  Stablecoin Tether (USDT), said in an interview:

“It is exciting that the Trump Administration intends to make the United States the center of digital financial technology innovation by ensuring that regulatory frameworks are clear, especially in regard to stablecoins and the growth of digital financial technology in the United States remains unhindered by restrictive regulations or unnecessary government interference.”

Vivek Ramsar, the CEO of etherealize.io, which connects institutions to the largest, secure, and open blockchain eco-friendly Ethereum (ETH) ecosystem around the world, concurs, “We believe this [EO] was a monumental structural change to make the US the capital of crypto and AI.”

The executive order rescinds:

• Executive Order 14067, issued by President Biden on March 9, 2022 which, among other things, placed “the highest urgency on research and development efforts into the potential design and deployment options of a United States CBDC.”
• The Department of the Treasury’s “Framework for International Engagement on Digital Assets,” issued on July 7, 2022, as detailed in a press release. 

Rhett Shipp, CEO of Avant, an onchain stablecoin dollar provider, explained to me: 

“President Trump’s executive order rejecting a U.S. CBDC and supporting stablecoins is a clear signal of where the industry is heading. Stablecoins already serve as a more effective alternative—boosting dollar adoption globally while maintaining financial privacy. With stablecoins increasingly backed by U.S. Treasuries, they align well with national interests. Supporting stablecoin growth, rather than introducing a government-controlled digital currency, is the right move for both financial innovation and the U.S. economy.”

Under the Biden administration, the crypto industry’s biggest complaint was the lack of regulatory clarity in the classification of digital assets between a security and a commodity.  And the Securities and Exchange Commission’s regulation by enforcement practices reached new highs.

Recent cases have shown that determining whether a cryptocurrency is a security is a complex task that may not always have a clear answer. For example, U.S. District Court Judge Amy Berman Jackson of the District of Columbia, who is presiding over the SEC’s case against Binance, made her views known on this issue during a hearing when she asked:

“Where’s the SEC been? Does that matter … why is it that if they’re trying to achieve legislation, is that some suggestion there’s something missing in the statute to cover this? Why are we doing this on a coin-by-coin, case-by-case, judge-by-judge litigation which depends on the … vagaries of the individual districts … as opposed to issuing a reg that tells everybody ‘this is it?’”

Similarly, U.S. District Court Judge Katherine Polk Failla of the Southern District of New York, who is overseeing the SEC’s case against Coinbase, made similar remarks.  And on January 7, she granted an interlocutory appeal of whether “certain transactions involving crypto-assets qualified as investment contracts within the SEC’s regulatory purview”—i.e., as securities “because it presents a controlling question of law regarding the reach and application of Howey to crypto-assets, about which there is substantial ground for difference of opinion, and the resolution of which would advance the ultimate termination of the SEC’s enforcement action,” she added.

President Trump has picked legislators who understand the industry—including David Sacks, the White House crypto and artificial intelligence czar; Representative French Hill as the chair of the House Financial Services Committee (watch his Atlantic Council event on stablecoins here); Senator Cynthia Lummis as the newly formed chair of the Senate Banking Committee’s subcommittee on digital assets,  SEC chair  Paul Atkins, Republican Commissioner Hester Peirce, advisors like Elon Musk who favors Memecoins and commerce secretary nominee Howard Lutnick. 

Confidence is growing that digital asset-friendly regulation is on its way with the U.S. Securities and Exchange Commission’s new task force that will develop a regulatory framework for crypto assets in collaboration with the CFTC to overhaul crypto policy expected to focus on easing regulatory burdens and creating a crypto-friendly regulatory framework, as well as on capital formation and an enforcement program that focuses on investor harms.

“The Executive Order sets the stage for a lot of activity in the blockchain and crypto world, including from regulators.  We are excited to work on the proposals as they take shape,” said Lee A. Schneider, General Counsel, Ava Labs, the company building out layer-1 blockchain Avalanche, which is the fastest smart contracts platform in the blockchain industry, as measured by time-to-finality. Eco-friendly Avalanche is low-cost and the preferred platform for tokenizing all world assets.

Currently, digital assets are regulated in the following areas in the US:

The TABLE from Chapter 21, page 152, Sustainably Investing in Digital Assets Globally, by Selva Ozelli Esq, CPA