How soon will we see President-elect Donald Trump’s strategic Bitcoin reserve in the United States? It might take longer than you think.
Trump’s choice for SEC, Paul Atkins, has had repercussions on the crypto scene. Atkins is a pro-crypto businessman and former SEC commissioner who represents a clear departure from Gary Gensler’s approach.
If confirmed, his mandate could rewrite the rules of digital asset regulation, tipping the scales in favor of innovation over oversight.
Still, don’t count on sending the world straight out of the gate.
Who is Paul Atkins? What could a pro-crypto SEC mean for the industry and the market?
Paul Atkins knows the SEC like the back of his hand. A Republican commissioner from 2002 to 2008 under George W. Bush, he built a reputation for opposing strict rules and favoring a careful dance between oversight and innovation.
During his tenure, Atkins advocated for proportional enforcement, advising that corporate fines should reflect individual wrongdoing rather than being used to grab headlines. This mindset fits with his criticisms of what he sees as the SEC’s aggressive stance under Gensler.
“The SEC must not exclude these same investors from our markets through burdensome regulations,” Atkins said in a previous speech.
Gary Gensler destroyed the reputation of the SEC with his failed approach to regulation by enforcement.
Paul Atkins will rebuild it.
– Tom Emmer (@GOPMajorityWhip) December 12, 2024
Since leaving the SEC, he has founded Patomak Global Partners, a consulting firm specializing in regulatory advisory. Notably, Patomak counted FTX among its clients during its brief rise, reinforcing Atkins’ controversial but active role in shaping financial innovation.
Day One Changes Unlikely: Donald Trump’s US Bitcoin Reserve Won’t Happen Overnight
For an industry grappling with lawsuits and regulatory uncertainty, Atkins’ appointment offers a glimmer of hope. Her ties to current Republican commissioners Hester Peirce (commonly known as “Crypto Mom”) and Mark Uyeda suggest that the SEC under Atkins may see a shift toward innovation-friendly policies.
Atkins is also co-chair of the Token Alliance, an advocacy group that pushes for clear crypto regulations.
However, changes will not happen overnight. The SEC’s existing lawsuits against crypto companies and legal precedents set during Gensler’s tenure are not easy to undo. Atkins should build consensus within the agency and the broader regulatory framework to pivot the SEC toward a more crypto-friendly position.
Oh Gary, how could you do this to me?
pic.twitter.com/OoooQI77ZS
– Elon Musk (@elonmusk) December 12, 2024
Even though Atkins is clearly pro-crypto, his ability to implement sweeping reforms will depend on several factors. For one thing, his nomination still needs to be confirmed by Congress, which could become a drawn-out process given partisan divisions. Additionally, existing regulatory processes and lawsuits, like those involving Kraken and Ripple, would limit any immediate overhaul.
If Paul Atkins wins the SEC chairmanship, crypto companies, battered by years of friction, could see a landscape that encourages progress instead of punishing it. While the revolution won’t start overnight, Atkins represents a long game worth betting on as the industry looks ahead to 2025.
Some Good News: Texas Bitcoin Reserve Shows States Moving Forward
A bill proposing a state-run bitcoin reserve landed in the Texas House on Thursday, setting crypto circles abuzz. Rep. Giovanni Capriglione outlined the plan on X Spaces, fueling talk that 2025 could well rewrite the industry playbook.
Yeah Haw partner! No, that’s a good thing happening there. It’s okay, that’s what I’m saying. Texan baby!
Taxes, fees and even Bitcoin donations would fuel the reserve, which the state plans to hold for at least five years. Some see this as a first step for the U.S. Treasury to take notes.
The rush for Bitcoin is taking the form of an arms race, involving companies, states and sovereign nations alike.
Here’s a theory on how things will play out, which we’ve detailed in more detail in our weekly. Feel good Friday bulletin:
Phase 1: Institutional adoption
Bitcoin has become “digital gold” and large US companies, such as Tesla and MicroStrategy, as well as financial institutions have led the way in holding Bitcoin as a reserve asset or as an investment.
Phase 2: ETFs and leverage (the phase we are currently in)
Approval of Bitcoin spot ETFs accelerates institutional and commercial adoption. ETFs attract billions of dollars of investment due to their accessibility and perceived security.
Phase 3: Business Integration
And here’s where we’re going: Big companies like Apple, Google, and Amazon will add Bitcoin to their balance sheets. It only takes one to cause FOMO. CFOs justify this decision with diversification and alignment with progressive financial trends. BTC could be used for payroll, corporate transactions and business-to-business settlements.
Phase 4: Financialization of Bitcoin
Finally, in the long term, we will see Bitcoin-backed securities, derivatives and structured products proliferate on the financial markets. Banks will create products such as mortgages or loans backed by Bitcoin, and Bitcoin will serve as collateral for high-stakes institutional trading.
Not everything that has been promised for Bitcoin and crypto will come to fruition at the same time. But with Trump’s pro-crypto lineup in the White House and Congress leaning the same way, 2025 is shaping up to be a pivotal year for crypto holders.
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