The Impact of Trump’s Presidency on the Crypto Community

When former US President Donald Trump won the 2024 presidential election race, the media reported it as a win for the cryptocurrency community. Crypto investors, inspired by the election of a candidate who espoused a commitment to make the US “the biggest and the best” in the crypto space, drove Bitcoin prices to record highs in the days after the election.

As election excitement subsided, however, investors’ enthusiasm became a bit more tempered. Trading in late November cooled, triggering a slide in Bitcoin prices. The shift, which pulled the leading crypto token back as it crept toward the $100,000 mark, could be a sign that investors want to wait and see if President-elect Trump will follow through on his promises regarding crypto.

Patrick Gruhn, the founder and CEO of Perpetuals.com, sees the election results as a win for crypto that will ultimately usher in an era of healthy crypto growth.

“I expect a way more business-friendly environment for the crypto industry from the second Trump administration,” Gruhn says. “I also expect a shift in the SEC’s positions and enforcement actions under the new Trump administration that will specifically benefit Level 1 projects like Ethereum and Solana, including ETFs built on those platforms, with the same being true for other crypto projects that are in similar ways not very close to classic securities. Overall, I believe the next four years will lead to a significant growth of the crypto space in the US, which will also benefit crypto-related stocks.”

Perpetuals.com is a MiFID II market infrastructure startup for crypto derivatives trading designed to empower perpetual futures trading without boundaries. Gruhn brings a long history in the digital asset space to the venture, including experience as a Partner at K&G Lawyers, a Swiss firm specializing in digital assets, and as co-founder of DigitalAssets.ag — the company that made tokenized stocks available with an approved security prospectus.

Gruhn’s mention of SEC enforcement actions refers to what many crypto advocates have seen as missteps by the US Securities and Enforcement Commission, which even SEC Commission Mark Uyeda admitted have led to problems for the industry.

“I expect enforcement actions to focus more on bad actors and projects that cross the line into the regulated securities or derivatives area, and not as artificial arguments that stretch the security law definition as we have seen in the last four years,” Gruhn says.

Evolving beyond Biden’s restrictive policies

Trump’s crypto campaign promises, which included a commitment to “end Democrats’ unlawful and unAmerican Crypto crackdown,” are expected to bring about an end to an era that was marked by what many saw as repressive policies. The platform also included a commitment to “defend the right to mine Bitcoin, and ensure every American has the right to self-custody of their Digital Assets, and transact free from Government Surveillance and Control.”

Those in the crypto industry widely criticized President Biden for failing to foster an environment where crypto can grow. Vetoing a resolution that would have limited the US SEC’s authority in the crypto space is a recent example of the president’s stance.

Gruhn believes the reception the crypto industry has given to Trump has a lot to do with its bad feelings about Biden’s policies and fears that another Democrat in the White House would have continued those policies. “After the crypto-hostile experience of the administration over the last four years, the crypto community quickly became very supportive of Donald Trump after he became crypto-friendly,” he says.

Coordinating with other key elements

While a supportive presidential administration will be helpful to crypto growth, it is not the only factor in play. Technology advancements can also play a role, facilitating safer and more user-friendly engagement. Investor sentiment, which can be influenced by everything from social media influencers to geopolitical tensions, is another factor that can impact crypto values.

“Investors should keep in mind that other factors will also impact the value of crypto assets and crypto-related stocks,” Gruhn warns. “Even with expected significant growth, the right timing for entry and exit and risk management are crucial.”

Gruhn also points out that the Trump administration’s favorable stance toward crypto could have a limited impact on growth if the industry does not find support in the US Congress. He highlights the recent decision to elevate Senator Elizabeth Warren, who is reportedly on an “anti-cryptocurrency crusade,” to the ranking Democrat position in the Senate Banking Committee as one that “will have a significant impact on what we can expect in terms of new legislation for the crypto industry.” 

The future growth of crypto involves many moving pieces, including efficiency, security, and real-world utility. Although Trump’s victory indicates the industry will have a favorable regulatory and enforcement regime in which to grow, whether or not it can secure other key factors remains to be seen.

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