Following the recent electoral victories of Donald Trump and the Republican party, Bitcoin is set to become a significant political asset, according to insights from the New York Digital Investment Group (NYDIG).
On 11 November 2024, the investment management firm said investors who have yet to embrace Bitcoin may find themselves at a disadvantage as crypto prices continue to surge.
“While some investors have allocated to Bitcoin, the most common allocation for investors is still zero,” said Greg Cipolaro, NYDIG’s global head of research. “There are no excuses now.”
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Bitcoin Is Up 84% YTD
Bitcoin has surged by 84% this year, reaching new heights near $82,000. This rally is fueled in part by the political landscape shaped by Trump’s presidency.
With the Republicans poised to maintain control over both the Senate and possibly the House, the political climate appears increasingly favorable for the cryptocurrency sector.
The Republicans’ success in retaining a Senate majority and their favorable stance toward legislation, supported by the crypto industry, suggests a more secure place for blockchain and cryptocurrency at the highest levels of government.
According to Cipolaro, this could lead to greater mainstream acceptance and integration of these technologies within the financial system.
INSIGHT: Bitcoin to become a "political imperative," owning none may be "a liability" — USEFUL
Greg Cipolaro, NYDIG’s global head of research, warns: “Investors who may have found it easy to dismiss or ignore the asset for various reasons will continue to do so at their… pic.twitter.com/y5vcJlzTyM
— Catch The Latest (@CatchTheLatest) November 11, 2024
Looking ahead to 2025, Cipolaro anticipates significant changes in the leadership of major agencies and departments, which could pave the way for pro-crypto legislation and regulations.
He also noted potential changes at the Securities and Exchange Commission (SEC), where Trump has indicated plans to replace current Chair Gary Gensler. Under Gensler’s tenure, the SEC came to be known for its rigorous enforcement actions against various crypto companies.
Cipolaro speculates that a shift in leadership could soften the SEC’s stance, possibly leading to settlements that allow crypto companies to operate within a clearer regulatory framework.
Some lawsuits may even be dropped if they are deemed not to serve the public interest. This shift could also affect potential enforcement actions previously hinted at through Wells notices to major crypto players like Robinhood, Crypto.com, and others.
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Pro-Crypto Bosses To Take Over Key Positions
Cipolaro said further regulatory changes are expected under the new administration, with likely appointments of pro-crypto advocates to lead the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, and the Treasury.
These changes could foster a more supportive environment for banks to provide custody services for digital assets, including stablecoins, enhancing the integration of cryptocurrencies into the broader financial ecosystem.
Meanwhile, Andreessen Horowitz’s (a16z) crypto division also views the reelection of Trump as a pivotal moment for the future of cryptocurrency regulation in the United States.
“The good news is that there is now a pathway for constructive engagement with regulatory agencies and legislation that can bring regulatory clarity,” a16z told crypto founders in a new post.
“You should now all feel empowered to explore all of the groundbreaking products and services that blockchains enable, including tokens.”
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