JPMorgan Analysts Expect Major Changes in Crypto Markets Under Trump
JPMorgan analysts anticipate significant shifts in crypto markets if Trump returns to the presidency, driven by a Republican-controlled Congress and expected crypto-friendly policies.
Pending Legislation Advances
Key legislation, including the Financial Innovation and Technology for the 21st Century Act (FIT21) and the Clarity for Payment Stablecoins Act of 2023, may be expedited. These bills aim to clarify the roles of the SEC and CFTC, establish stablecoin frameworks, and limit government-backed digital currencies in favor of private alternatives.
Collaborative Regulatory Environment
JPMorgan suggests a potential shift from the SEC’s enforcement-driven actions to a more collaborative approach, possibly resolving lawsuits like the one against Coinbase, which might reduce barriers for firms such as Robinhood and Uniswap.
Easing Banking Restrictions
Reversing SEC’s SAB 121, which restricts banks' engagements with digital assets, could enhance traditional banks' roles in crypto custody. Changes in leadership at the OCC and FDIC could also encourage more bank involvement in digital assets.
ETF Approvals
There may be optimism for spot ETF approvals, particularly for XRP and Solana. However, legal challenges regarding their classification as securities might delay these approvals.
Increased Investment
Clearer regulations could foster venture capital, IPOs, and M&A activity, with Wyoming’s DAO-friendly laws providing frameworks for further innovation.
Low Chance of a Bitcoin Reserve
While the BITCOIN Act proposes making Bitcoin a U.S. strategic reserve asset, JPMorgan views this as unlikely.
JPMorgan concludes that these changes may enhance growth and legitimacy for crypto markets in the U.S., although some reforms might face delays or political resistance.
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