US Crypto Industry Celebrates 2025 Victories, Yet Concerns Loom for Next Year

After celebrating Donald Trump’s second presidential term with cocktails and Snoop Dogg at a pre-inauguration event in January, the crypto industry achieved significant legislative and regulatory victories this year.

However, the celebratory mood may not last through 2026.

Among the industry’s notable achievements during Trump’s crypto-friendly administration were the Securities and Exchange Commission’s (SEC) rapid rescindment of stringent crypto accounting guidelines and the dismissal of Biden-era lawsuits against major players like Coinbase and Binance. Additionally, a landmark law was passed, establishing federal regulations for dollar-pegged crypto tokens.

A leading bank regulator also relaxed rules regarding banks’ crypto dealings and conditionally approved bank licenses for crypto firms. Coupled with Trump’s establishment of a bitcoin stockpile and the SEC’s approval of various new crypto products, these changes propelled bitcoin to new heights this year, fostering wider crypto adoption. However, critics have raised alarms about potential investor and systemic risks.

Despite these victories, critical legislation addressing the crypto market structure and necessary carve-outs from SEC regulations remain pending. This uncertainty threatens to dampen the industry’s celebratory atmosphere, as highlighted by several industry executives at a recent Reuters NEXT event.

“This year’s been a good year for crypto … notwithstanding that there’s a lot of work left to be done,” remarked Miller Whitehouse-Levine, CEO of the Solana Policy Institute, which advocates for blockchain-friendly policies.

Crypto President

Trump has actively sought industry support, branding himself as a “crypto president.” His family’s crypto ventures have also contributed to the sector’s mainstream acceptance, according to industry executives.

Shortly after taking office, the SEC swiftly ended a prolonged crackdown that had seen numerous crypto companies sued for failing to register with the agency. The industry argued that many crypto tokens resemble commodities more than securities.

To solidify this stance, crypto companies and executives contributed over $245 million during the 2024 election cycle to support pro-crypto candidates, including Trump, as per Federal Election Commission data.

In July, the House of Representatives passed a bill aimed at defining when tokens are classified as securities, commodities, or otherwise, providing the industry with much-anticipated legal clarity. However, progress has stalled in the Senate due to disagreements over anti-money-laundering provisions and requirements for decentralized finance platforms, which enable users to trade tokens without intermediaries.

“The big elephant in the room is that this industry has spent millions of dollars trying to get legislation across the line,” stated Sheila Warren, CEO of the tech-focused nonprofit Project Liberty Institute, during the Reuters NEXT event. “But it is uncertain that it will score that key victory.”

With Congress shifting focus to the 2026 midterm elections, where Democrats may regain control of the House, the bill’s future remains uncertain, according to lobbyists. This scenario could force crypto firms to rely on regulatory guidance that may be overturned by a less favorable administration, exposing them to legal challenges or necessitating a reduction in U.S. operations.

Long-term, the industry cannot depend solely on pro-crypto administrations, emphasized David Mercer, CEO of LMAX Group, which operates a crypto exchange. “We need the market structure bill.”

A spokesperson for Tim Scott, chair of the Senate Banking Committee, which is co-authoring the Senate’s version of the bill, indicated that negotiations are ongoing, with hopes to advance the legislation in “early 2026.”

Regulation Fixes

In the interim, crypto firms are focusing on regulatory solutions, particularly an SEC “innovation exemption.” Trump’s SEC chair, Paul Atkins, has indicated that this framework, expected to be unveiled next year, will enable crypto companies to launch new business models without immediate regulatory concerns. However, the scope of this exemption remains unclear.

Mercer noted that such an exemption could provide token issuers with “room to breathe” without the fear of SEC prosecution. The SEC has yet to comment on this matter.

Crypto companies are also anticipating improved coordination between the SEC and the Commodity Futures Trading Commission (CFTC), which should streamline oversight of crypto products. This initiative is expected to gain momentum with Trump’s CFTC chair nominee, Michael Selig, poised for Senate confirmation.

“It is making an impact,” remarked Les Borsai, co-founder of Wave Digital Assets, who attended the industry’s first-ever crypto pre-inauguration Washington ball in January, referring to the ongoing policy and personnel changes. With increasing clarity, he added, institutional investors should feel “much more comfortable entering the space.”

Topics
USA

After celebrating Donald Trump’s second presidential term with cocktails and Snoop Dogg at a pre-inauguration event in January, the crypto industry achieved significant legislative and regulatory victories this year.

However, the celebratory mood may not last through 2026.

Among the industry’s notable achievements during Trump’s crypto-friendly administration were the Securities and Exchange Commission’s (SEC) rapid rescindment of stringent crypto accounting guidelines and the dismissal of Biden-era lawsuits against major players like Coinbase and Binance. Additionally, a landmark law was passed, establishing federal regulations for dollar-pegged crypto tokens.

A leading bank regulator also relaxed rules regarding banks’ crypto dealings and conditionally approved bank licenses for crypto firms. Coupled with Trump’s establishment of a bitcoin stockpile and the SEC’s approval of various new crypto products, these changes propelled bitcoin to new heights this year, fostering wider crypto adoption. However, critics have raised alarms about potential investor and systemic risks.

Despite these victories, critical legislation addressing the crypto market structure and necessary carve-outs from SEC regulations remain pending. This uncertainty threatens to dampen the industry’s celebratory atmosphere, as highlighted by several industry executives at a recent Reuters NEXT event.

“This year’s been a good year for crypto … notwithstanding that there’s a lot of work left to be done,” remarked Miller Whitehouse-Levine, CEO of the Solana Policy Institute, which advocates for blockchain-friendly policies.

Crypto President

Trump has actively sought industry support, branding himself as a “crypto president.” His family’s crypto ventures have also contributed to the sector’s mainstream acceptance, according to industry executives.

Shortly after taking office, the SEC swiftly ended a prolonged crackdown that had seen numerous crypto companies sued for failing to register with the agency. The industry argued that many crypto tokens resemble commodities more than securities.

To solidify this stance, crypto companies and executives contributed over $245 million during the 2024 election cycle to support pro-crypto candidates, including Trump, as per Federal Election Commission data.

In July, the House of Representatives passed a bill aimed at defining when tokens are classified as securities, commodities, or otherwise, providing the industry with much-anticipated legal clarity. However, progress has stalled in the Senate due to disagreements over anti-money-laundering provisions and requirements for decentralized finance platforms, which enable users to trade tokens without intermediaries.

“The big elephant in the room is that this industry has spent millions of dollars trying to get legislation across the line,” stated Sheila Warren, CEO of the tech-focused nonprofit Project Liberty Institute, during the Reuters NEXT event. “But it is uncertain that it will score that key victory.”

With Congress shifting focus to the 2026 midterm elections, where Democrats may regain control of the House, the bill’s future remains uncertain, according to lobbyists. This scenario could force crypto firms to rely on regulatory guidance that may be overturned by a less favorable administration, exposing them to legal challenges or necessitating a reduction in U.S. operations.

Long-term, the industry cannot depend solely on pro-crypto administrations, emphasized David Mercer, CEO of LMAX Group, which operates a crypto exchange. “We need the market structure bill.”

A spokesperson for Tim Scott, chair of the Senate Banking Committee, which is co-authoring the Senate’s version of the bill, indicated that negotiations are ongoing, with hopes to advance the legislation in “early 2026.”

Regulation Fixes

In the interim, crypto firms are focusing on regulatory solutions, particularly an SEC “innovation exemption.” Trump’s SEC chair, Paul Atkins, has indicated that this framework, expected to be unveiled next year, will enable crypto companies to launch new business models without immediate regulatory concerns. However, the scope of this exemption remains unclear.

Mercer noted that such an exemption could provide token issuers with “room to breathe” without the fear of SEC prosecution. The SEC has yet to comment on this matter.

Crypto companies are also anticipating improved coordination between the SEC and the Commodity Futures Trading Commission (CFTC), which should streamline oversight of crypto products. This initiative is expected to gain momentum with Trump’s CFTC chair nominee, Michael Selig, poised for Senate confirmation.

“It is making an impact,” remarked Les Borsai, co-founder of Wave Digital Assets, who attended the industry’s first-ever crypto pre-inauguration Washington ball in January, referring to the ongoing policy and personnel changes. With increasing clarity, he added, institutional investors should feel “much more comfortable entering the space.”

Topics
USA