The cryptocurrency landscape of the Trump administration

Author: Jessy, Golden Finance

The day of Trump's official inauguration is approaching. He has also nominated members for his anticipated new cabinet. There is no doubt that Trump and some of his nominated cabinet members are crypto-friendly individuals.

Thanks to the crypto-friendly stance of the Trump administration, combined with the U.S. interest rate cuts, the crypto industry has officially entered a bull market.

For example, with the project WLIF, which is closely tied to the Trump family, continuously buying tokens like AAVE, LINK, and ENA, these tokens have seen significant price increases.

The upcoming market trend has also become quite clear. As the U.S. regulatory framework for crypto becomes more defined, DeFi-related projects will likely become one of the main narratives of the upcoming bull market. The Trump family's ongoing bets on DeFi projects are a reflection of this trend.

In terms of policy, the "21st Century Financial Innovation and Technology Act" is likely to pass. Once the bill is passed, it will clearly define when cryptocurrencies are considered commodities or securities. If the bill specifies that certain tokens are deemed decentralized and functional, they will be regarded as digital commodities and not subject to SEC regulation, and those meeting centralization requirements may qualify for a grace period. This will encourage DeFi projects to evolve towards greater decentralization. Furthermore, the bill requires the SEC and CFTC to study the development of DeFi, assess its impact on traditional financial markets, and explore potential regulatory strategies, which will attract more DeFi projects to "return" to the U.S., promoting the prosperity and development of the DeFi market.

It is based on this regulatory change in the U.S. that DeFi has become an important narrative in this bull market.

So, what projects are Trump and his cabinet members buying and supporting? What does this indicate about the future direction of crypto development?

Trump:

His Business Involvement in Crypto

WLFI:

World Liberty Financial (WLFI) is a crypto project endorsed by the Trump family, officially launching on September 16, 2024. Trump claims to be the Chief Crypto Advocate for the World Liberty Financial project.

Trump's two eldest sons, Donald Jr. and Eric, serve as Web 3 ambassadors for World Liberty Financial, while his 18-year-old son Barron Trump is the DeFi visionary for the project.

The project's white paper indicates that Trump will occasionally promote the project. In return, companies under Trump's name will receive 75% of the project's revenue.

The project primarily focuses on building lending services, such as a credit account system based on Aave and the Ethereum blockchain, as well as a decentralized cryptocurrency trading venue. The governance token for the project is WLFI.

Currently, the project is still in the public sale phase, having sold 1/4 of its tokens and raised $75 million.

WLFI is also continuously purchasing tokens from other projects. In the past period, its purchases include:

• ETH: Spent $30 million to buy 8,105 ETH over the past 12 days, with an average price of $3,701.
• AAVE: Purchased 6,137 AAVE at an average price of $324.
• LINK: Bought 78,387 LINK at an average price of $25.5.
• ENA: Acquired 509,955 ENA at an average price of about $0.981.
• Ondo: Bought 134,216 ONDO tokens at an average price of about $1.86.
• CB BTC: Purchased 103 CB BTC at a unit price of $97,181.

Most of the tokens purchased by WLFI are related to DeFi projects, highlighting WLIF's ambition to build an on-chain lending platform, which also includes an on-chain trading platform. The tokens it has acquired encompass stablecoins, collateralized lending, RWA, oracles, and wrapped Bitcoin, covering essentially all aspects of on-chain DeFi.

With the gradual clarification of U.S. regulations following Trump's ascension, DeFi is likely to enter a phase of robust growth.

Other Business Layouts in the Crypto Field

The Trump family’s companies are also actively laying out crypto businesses. For instance, the Trump family owns the cryptocurrency exchange "World Liberty Financial," and its social platform "Truth" has submitted an application to create a crypto payment service called "truthfi." They also plan to acquire the crypto service company Bakkt, all of which are closely related to virtual currencies.

Trump's Cryptocurrency Holdings:

According to Trump's wallet holdings, the token he holds the most is TROG, a type of Meme Coin, with ETH ranking second in his portfolio, as he owns over 495 ETH, valued at $1.99 million. Additionally, he holds over 478 WETH, valued at $1.93 million.

Some of the Meme Coins in his wallet, such as Trump, are primarily obtained through airdrops, while Ethereum comes from donations received during his presidential campaign and commissions from sales of related NFTs, including some from WLFI sales.

Trump's wallet also contains mainstream tokens like Matic, though the source is uncertain.

In terms of politics, Trump aims to make the U.S. a crypto-friendly nation, starting with making Bitcoin a national reserve, followed by establishing a series of policies and regulations to support the development of the crypto industry.

Most of Trump's cabinet members are also crypto-friendly individuals or already hold cryptocurrencies.

Trump Administration Cabinet Members' Crypto Holdings

The Trump cabinet includes 15 cabinet ministers and some cabinet-level officials, totaling around 20 people.

Among these 20 individuals, at least six are crypto-friendly, with several publicly stating their cryptocurrency holdings. These individuals include:

David Sacks

He was appointed by Trump as the head of the White House's AI and cryptocurrency affairs and also serves as the chairman of the President's Council of Advisors on Science and Technology.

He has a very positive attitude towards crypto, and his venture capital firm, Craft Ventures, has made numerous investments in the cryptocurrency space, covering infrastructure, CeFi, DeFi, NFT, and more, including projects like dydx and Lightning Labs.

Sacks' role as the head of the White House's AI and cryptocurrency affairs will help lead the implementation of Trump's campaign promise to relax regulations on the cryptocurrency industry. He will serve as a direct contact between cryptocurrency advocates and the White House, as well as a liaison between Trump, Congress, and federal agencies dealing with digital assets, promoting the formulation and implementation of relevant policies to create a more favorable policy environment for the cryptocurrency industry.

Currently, public records show that he holds at least Bitcoin and Solana.

Bitcoin: In 2012, David Sacks began investing in Bitcoin and adopted a "set it and forget it" long-term holding strategy, viewing Bitcoin as a tool to hedge against fiat currency inflation and censorship.

Solana: In October 2021, David Sacks revealed in a podcast that he holds a significant amount of Solana. Even after the FTX collapse in 2022, which triggered turmoil in the crypto market, he did not sell his Solana holdings and firmly believes in its potential to surpass Ethereum in the future.

Robert F. Kennedy Jr.

Nominated by Trump as the Secretary of Health and Human Services.

He believes that cryptocurrencies are a good way to hedge against inflation and considers Bitcoin to be a "perfect base currency." He hopes to make the U.S. the global center for cryptocurrency and has proposed a series of policy suggestions, such as exempting capital gains tax on converting Bitcoin to dollars and backing the dollar with hard assets like Bitcoin. He also plans to promote budget transparency by putting the entire U.S. budget on the blockchain to enhance transparency and accountability, allowing every American to view budget items at any time to prevent corruption and misuse of funds.

It has been disclosed that Robert F. Kennedy Jr.'s family trust holds Bitcoin valued between $100,000 and $2.5 million, and he personally purchased 21 Bitcoins during his campaign, buying 3 Bitcoins for each of his children, demonstrating his support for cryptocurrencies through actual investments.

Howard Lutnick

Nominated by Trump as the Secretary of Commerce, and if confirmed, he will also directly oversee the U.S. Trade Representative's office.

He believes that Bitcoin has values such as decentralization and is the only asset that cannot be taken away by anyone. He also advocates that Bitcoin should be treated as a commodity, similar to gold and oil.

Lutnick is a staunch supporter of the stablecoin Tether, and his company Cantor Fitzgerald not only holds undisclosed shares of Tether but also manages Tether's vast reserve assets, which are mostly in the form of U.S. Treasury bonds.

On July 27, 2024, at the Bitcoin 2024 conference in Nashville, Lutnick announced a $200 million Bitcoin loan program to provide leverage for Bitcoin holders.

Tulsi Gabbard

Nominated by Trump as the Director of National Intelligence.

In 2019, Tulsi Gabbard signed a bill aimed at preventing the SEC from regulating cryptocurrencies. She believes that this bill will protect investors, promote innovation, and bring more diverse business opportunities to her region, driving the U.S. development in the digital economy.

In 2023, Tulsi Gabbard publicly criticized the Biden administration's exploration of central bank digital currencies at the Bitcoin 2023 conference. She believes that central bank digital currencies would record transaction information, increasing the risk of surveillance on ordinary Americans, thereby threatening people's freedom and economic autonomy.

She emphasized that Bitcoin, as a decentralized cryptocurrency, possesses qualities that cannot be manipulated by third parties, preserving the privacy and freedom of cash transactions in the digital world, and therefore believes that cryptocurrencies like Bitcoin have a positive significance for social development.

According to public documents from December 2017, she held Ethereum and LTC valued between $1,000 and $15,000, though it is unclear whether she still holds them.

Conclusion

As the first U.S. president to openly support the crypto industry, Trump is not only actively or passively holding crypto assets but is also expanding his business interests into the crypto field. From selling NFTs in earlier years to currently engaging in DeFi projects and acquiring exchanges, Trump's involvement in the crypto industry is deepening.

Not only is he deeply involved in the crypto industry from a business perspective, but after becoming president, the strategic Bitcoin reserves in the U.S. are highly likely to become a reality. Coupled with his push for crypto legislation, relaxation of regulatory measures, and establishment of dedicated institutions and positions for crypto, it is evident that this will facilitate a better coordination between the government and the crypto industry, allowing the crypto industry to operate under a legal framework in a relatively relaxed environment.

The cabinet members chosen by Trump are also generally representatives of crypto-friendly policies. Although the chosen SEC chair, Paul Atkins, has not publicly disclosed any cryptocurrency holdings, he is indeed a staunch supporter of cryptocurrencies. There are expectations that after he takes office, he will review several rules and court enforcement actions under Gary Gensler and adopt a more lenient attitude towards cryptocurrencies, seeking regulatory reforms aimed at promoting capital formation to create a more favorable regulatory environment for the crypto industry.

Some cabinet members, even if their nominated positions are not directly related to economics, have also clearly expressed their support for crypto. As policymakers, only those who genuinely hold virtual currencies will formulate truly crypto-friendly policies.

Currently, based on the holdings of Trump and some cabinet members, as well as the expansion of their crypto landscape, it can be seen that the U.S. may invest significantly in the DeFi sector.