Trump issues an executive order to strengthen the cryptocurrency industry

President Trump on Thursday issued an executive order to support the growth of the cryptocurrency industry and called for a new plan to regulate a company in which he has significant personal investments.

The executive order, which was light on details, said the Trump administration would create a working group on digital assets to come up with a comprehensive plan that would include “regulatory and legislative proposals.” The group will also consider establishing a national repository of cryptocurrency, a government-controlled repository of digital coins that the industry has spent months lobbying the new administration to create.

“The digital asset industry plays a critical role in innovation and economic development in the United States, as well as our nation’s international leadership,” the order states. “It is therefore my administration’s policy to support the responsible growth and use of digital assets.”

Mr. Trump has a significant personal stake in the success of the crypto industry. Last year, he and his sons co-founded a crypto firm called World Liberty Financial, which is selling a new digital currency called WLFI. This month, he and his wife, Melania, each began selling memecoins, a form of cryptocurrency inspired by an online joke or celebrity mascot.

The companies have drawn criticism from ethics experts who are concerned about conflicts of interest. In reality, Mr. Trump to write the rules for business ventures that he can personally profit from. He has pledged to end the Biden administration’s legal crackdown on crypto companies and made a series of staff selections at key federal agencies that appear poised to boost the crypto industry’s prospects.

In the announcement, Mr. Trump that his administration was committed to “protecting and promoting” the crypto industry. He promised “fair and open access to banking services,” a response to complaints from crypto companies that banks have denied them accounts.

Still, the order didn’t go nearly as far as many in the crypto industry had hoped. Mr. Trump did not order federal agencies to drop lawsuits against crypto companies, nor did he order the government to start buying Bitcoin.

Among the more substantive elements of the order is a ban on the creation of a “central bank digital currency,” a form of cryptocurrency overseen by the government. Many crypto-enthusiasts oppose the creation of such currencies for ideological reasons, and Mr. Trump promised on the campaign trail to ban them.

But in one analysis of the order Molly White, a crypto researcher, noted that no federal agency has ever seriously pursued creating such a cryptocurrency. Mrs. White called Mr. Trump’s order “mostly symbolic.”

As a one-time skeptic who dismissed Bitcoin as a scam, Mr. Trump an outspoken digital currency enthusiast on the campaign trail as the crypto industry poured more than $130 million into high-profile congressional races. At a Bitcoin conference in July, Mr. Trump to make the US the “crypto capital of the planet”.

Then in September, the Trump family started World Liberty Financial, which they marketed as a platform to facilitate borrowing and lending in digital currencies. Mr. Trump is not a direct owner of World Liberty Financial, but he receives a cut of sales of WLFI, the cryptocurrency associated with the platform.

Since the election, Mr. Trump moved to reshape the regulatory agencies that pursued crypto companies during the Biden administration. In December, he elected a new chairman of the Securities and Exchange Commission, who has worked closely with crypto companies. And he tapped venture investor and digital currency enthusiast David Sacks to oversee his administration’s policies on artificial intelligence and crypto.

But Mr Trump’s most aggressive foray into the crypto market came on Friday night when he announced a memecoin called $Trump. Sales of the cryptocurrency immediately soared, adding tens of billions of dollars to Mr. Trump’s net worth, at least on paper. The price collapsed two days later after Melania Trump announced that she was also offering a memecoin.

The episode sparked outrage from crypto traders who said they felt burned by the back-to-back announcements and chaotic price movements. But the industry still has high expectations for the Trump administration. Crypto executives have been lobbying him for months, hoping to secure his support for legislation that would crack down on the SEC and increase the prices of the leading digital currencies.

Hours before Mr. Trump’s inauguration on Monday sent the price of Bitcoin soaring to a record of more than $109,000 as crypto supporters celebrated the ascension of a man they described as the first “Bitcoin President.”