Bitcoin has recently surpassed the $100,000 mark, driven by a substantial rally following Donald Trump’s U.S. presidential election win. The cryptocurrency increased from $69,374 on Election Day to hitting an all-time high of $103,713. This surge is attributed to Trump's pro-cryptocurrency stance and his nomination of cryptocurrency advocate Paul Atkins as the next SEC chair. Trump’s election victory has raised hopes among top crypto players for favorable legislative and regulatory changes. Despite this rally, experts caution about the risks and volatility associated with bitcoin investment. The sustainability of this upward trend depends on several factors, including regulatory decisions and market conditions. Though it could continue to climb, bitcoin’s history shows it can also decline rapidly, making it a speculative investment.
In a significant policy shift, the Federal Deposit Insurance Corporation announced that banks no longer need prior approval to engage in cryptocurrency-related activities, such as holding digital currency assets or partnering with industry companies. This marks a significant policy reversal from the cautionary stance adopted two years ago under the Trump administration. FDIC acting chairman, Travis Hill, emphasized the shift away from the previous, flawed approach. This change comes after a joint warning issued in January 2023 by the Fed, FDIC, and the Office of the Comptroller of the Currency following the crash of the terra stablecoin and FTX's downfall. The OCC was the first to revise guidelines allowing banks to partake in common crypto activities without prior approval. Legal actions by Coinbase revealed FDIC's updated policy, which now requires institutions to manage associated risks adequately while engaging in digital asset activities.
U.S. regulators, including the Securities and Exchange Commission and the Financial Industry Regulatory Authority , are investigating unusual stock price movements in companies prior to their announcements of cryptocurrency-related treasury strategies. The investigation aims to identify potential insider trading and violations related to the selective disclosure of material nonpublic information. Over 200 companies that have announced plans to raise funds to invest in cryptocurrencies in 2025 have been contacted as part of this probe. The SEC has also issued warnings to firms about possible breaches of disclosure rules. This regulatory scrutiny comes amid a broader trend of publicly traded companies venturing into cryptocurrency investments, following the model of earlier adopters like the software company formerly known as MicroStrategy, which began purchasing bitcoin in 2020. While the SEC declined to comment, FINRA has yet to respond, and the details reported remain unverified by Reuters.
In the corporate sector, Trump Media & Technology Group and Crypto.com have announced the formation of a new company, Trump Media Group CRO Strategy, aimed at investing in the cryptocurrency Cronos. The venture will go public through a SPAC merger with Yorkville Acquisition Corp and be listed on the Nasdaq under the “MCGA” symbol. The move strengthens U.S. President Donald Trump’s connection to the crypto sector, boosted by favorable industry regulations under his administration. Following the news, the Cronos token surged nearly 30%, Trump Media’s stock rose 5.2%, while Yorkville's dropped slightly. The new firm will be funded with $1 billion in Cronos tokens, $200 million in cash, $220 million in warrants, and a $5 billion equity line from a Yorkville affiliate. Trump Media committed to buying $105 million in Cronos, and Crypto.com agreed to purchase $50 million of Trump Media stock. The partnership advances previous collaborations, including exchange-traded funds under the Truth.Fi brand. This move follows a trend of crypto-heavy companies, such as MicroStrategy, leveraging SPACs to capitalize on soaring digital asset valuations.
Additionally, President Donald Trump's cryptocurrency endeavors are expanding with the launch of a new dollar-backed stablecoin through World Liberty Financial and the introduction of investment funds for digital assets in collaboration with Trump's Truth Social parent company, Trump Media & Technology Group Corp . Announced on Tuesday, the stablecoin will be pegged at a 1-to-1 ratio with the U.S. dollar, aiming to facilitate seamless and secure cross-border transactions. Additionally, TMTG plans to release themed exchange-traded funds later this year in partnership with Crypto.com. As critics voice concerns about the appropriateness of a public office holder engaging in such financial ventures, Trump continues to promote these projects and aims to make the U.S. a leading hub for cryptocurrency. Despite ethical agreements that restrict his direct involvement in day-to-day management, Trump actively endorses and profits from these crypto-related initiatives.
These developments underscore the rapidly evolving landscape of cryptocurrency in the United States, marked by significant policy shifts, regulatory scrutiny, and increasing corporate involvement. As the market continues to mature, stakeholders are closely monitoring these trends to navigate the complexities of the digital asset ecosystem.
