Donald Trump made a lot of promises to the Bitcoin community during his 2024 presidential campaign. We even saw him turn up at the Bitcoin Conference in Nashville to secure ever more votes but above all, funds for his campaign. Donald Trump has talked a lot and promised a lot. With his inauguration set for January 20, 2025, the time has come for Donald Trump to keep his promises.
There have been doubts in recent times about Donald Trump’s ability to keep his promises. In my opinion, we’ll soon find out. Donald Trump has already paved the way by building a pro-Bitcoin administration. However, we’ll have to see what Donald Trump can pass via Executive Orders and what he’ll have to negotiate with the US Congress.
Without taking into account these political balances, which will have a major role to play, I can already tell you the 3 major actions in favor of the Bitcoin revolution that Donald Trump must take immediately. Some dream that these strong acts will be announced on the first day of his second term, but I’ll be more measured and talk about the first 100 days of his presidency.
1. Repeal SAB 121
So far, US banks are bearing the brunt of a rule issued by the SEC in March 2022, known as SAB 121, which requires them to consider Bitcoin and the cryptocurrencies they hold as liabilities on their balance sheets. This rule is seen by the entire industry as a brake on institutional adoption. Indeed, it increases capital requirements and deters many financial players from becoming more involved in the sector.
This rule issued by the SEC should be added to the Biden administration’s list of direct attacks on Bitcoin and cryptocurrency as part of what is commonly referred to as “Operation ChokePoint 2.0”.
Donald Trump is eagerly awaited on the subject. By appointing a pro-Bitcoin administration, we can already be assured that Operation ChokePoint 2.0 will not be pursued. Donald Trump could issue an Executive Order on his first day in the White House to repeal SAB 121. This would be a good way of showing that he’s going all out to keep his many pro-Bitcoin and pro-Crypto pledges made during his presidential campaign.
2. A Strategic Bitcoin Reserve for America
Donald Trump promised during his campaign that sales of Bitcoin held by America would be halted during his presidency. This is a matter of urgency, as the Biden administration may make a point of selling more just before Donald Trump takes office. It may have begun in the last few days…
Donald Trump could easily decide that all this Bitcoin should be kept by America. Where his job will be harder is in keeping his commitment to create a strategic Bitcoin reserve for America. Senator Cynthia Lummis has proposed the Bitcoin Act so that America can carry out an ambitious plan to purchase 1 million BTC in 4 years.
Several questions arise:
- Can Donald Trump decide to have the U.S. Treasury hold this Bitcoin instead of the Fed?
- Can Donald Trump pass an Executive Order validating the Bitcoin Act?
- Will Donald Trump succeed in passing the Bitcoin Act if it has to go through the US Congress?
- How will the massive purchase of Bitcoin be financed over the next 4 years?
A lot of questions that we won’t necessarily have answers to within 100 days of Donald Trump’s inauguration. But it will be a topic that will excite the entire industry for sure. Cynthia Lummis proposes that America sell some of its (alleged) gold reserves to buy this Bitcoin. Michael J. Saylor proposes that America print U.S. dollars out of thin air to buy at least 25% of the Bitcoin supply in circulation to take control. No wonder many consider Michael J. Saylor a complete betrayal of the spirit of the Bitcoin revolution.
Donald Trump will also have to be wary of such a strategy, which could start a Bretton Woods III, from which America would not be sure to emerge as advantaged as it is in the current monetary and financial system.
3. Making Bitcoin Transactions Tax-Free
There is an urgent need to change the rules governing the taxation of Bitcoin. Donald Trump himself said during his campaign that it wasn’t possible to make everyday purchases in Bitcoin if it resulted in a tax event every time. To facilitate the development of Bitcoin as an everyday MoE, it is necessary to change the regulations. Michael J. Saylor repeats that Bitcoin as a MoE is a distraction, but he’s wrong. It’s essential for the long-term success of the Bitcoin revolution!
The question here is how this more compatible regulation would translate into the development of Bitcoin as an everyday MoE. Donald Trump could decide to make all transactions under $1,000 tax-free, for example. This amount could be lowered or increased, of course – this is an example. Donald Trump could decide that all Bitcoin held for more than a year is exempt from taxation because it’s no longer speculation, but a long-term investment. Some countries already apply such a regulatory framework.
There is a great deal to be done in this area, and we must hope that Donald Trump will keep his promises in this regard, or risk disappointing the Bitcoin community. The moment of truth is fast approaching!
