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Last week, President Trump issued an Executive Order titled “Strengthening American Leadership in Digital Financial Technology.” The new order repeals President Biden’s 2022 Executive Order on digital assets and other Biden-era digital policies. Sullivan & Cromwell’s memo on the new order says that it also:

– Outlines key digital asset policy objectives, including: (i) protecting and promoting access to and use of open public blockchain networks “for lawful purposes” and without “persecution,” including developing and deploying software, mining and validating activity, transacting without “unlawful
censorship,” and maintaining self-custody of digital assets; (ii) promoting the growth of “lawful and legitimate” U.S. dollar-backed stablecoins; (iii) protecting “fair and open access” to banking services for “law-abiding” individuals and firms; (iv) providing regulatory clarity and certainty “built on technology-neutral regulations”; and (v) protecting against the risks associated with CentralBank Digital Currencies (“CBDCs”);

– Establishes the President’s Working Group on Digital Asset Markets (the “Working Group”), chaired by the Special Advisor for AI and Crypto and including the Treasury Secretary, SEC Chairman, CFTC Chairman, Attorney General, and various national security and technology officials;

– Instructs the Working Group to: (i) within 30 days, identify all “regulations, guidance documents, orders, or other items that affect the digital asset sector”; (ii) submit recommendations to the Chair within 60 days with respect to those regulations and guidance (e.g., to rescind or modify); (iii) submit a report to the President within 180 days proposing a Federal regulatory framework for
digital assets; (iv) evaluate a potential national digital assets stockpile; and (v) consult with the National Security Council and digital asset market experts, as appropriate; and

– Prohibits agencies from undertaking any action to establish, issue, or promote CBDCs.

The Trump administration’s crypto czar David Sacks touted the order, but crypto skeptics are less enamored with it. Here’s what one industry watcher had to say:

“Any crypto regulation should actually protect investors rather than defending the ability of cryptocurrency issuers to stuff the public with another useless digital currency,” says James Royal, Bankrate principal investment and wealth management reporter. “Given the crypto industry’s sizable donations to the Trump campaign and the Trump family’s own personal stake in newly launched cryptocurrencies, I’m not optimistic that any regulation proposed here will do much more than pave the way for legalized scams.”

Media reports suggest that crypto backers are likely to be disappointed that the order merely calls for a study to evaluate a national cryptocurrency stockpile, instead of immediately creating one.

– John Jenkins