Expert's Take: Trump To Take 'Less Prosecutorial' Stance On Crypto, 2025 Outlook With Taraxa Co-founder

Donald Trump will re-take the White House in less than a week, and among the industries that are anticipating his re-entry is crypto, a burgeoning sector that has yet to be widely recognized in the current world order but has largely proven its potential even under some innovation-crippling circumstances.

With a new U.S. administration set to rule a country that's largely been watched by the world for its tech innovation, a question hangs in the balance: how will Trump 2.0 affect the industry's growth and development?

In an exclusive with International Business Times, Steven Pu, co-founder at Taraxa, the world's only EVM-compatible blockDAG Layer 1, discussed the impact of the Trump administration not just for the U.S. cryptocurrency market but also the global crypto space.

Will Trump Establish a U.S. Strategic Bitcoin Reserve?

During the presidential campaign, there were talks about a U.S. BTC strategic reserve should Trump secure the presidency, especially after he appeared at the Bitcoin conference in Nashville alongside Republican Sen. Cynthia Lummis.

At the time, Lummis promised she would push for a Bitcoin reserve. Notably, Lummis is a Trump ally and has spoken multiple times about her plans for a BTC reserve after the 2024 elections.

For Pu, the idea of a U.S. strategic Bitcoin reserve will rely largely on how much priority the incoming president gives to crypto, given the many facets of leadership that he has to tackle.

"The President alone cannot unilaterally place any asset on the country's balance sheet – such a decision requires congressional approval. However, with Republican control over both the House and Senate in the upcoming session and Trump's consistent statements highlighting the importance of the issue, I remain optimistic about the potential for a legislative push to establish a Bitcoin reserve," Pu said.

He went on to note that there's a deeper note behind a BTC reserve in the U.S. "More significant than the size of the reserve itself is the message it would send – signaling that digital assets like Bitcoin are viewed as sufficiently stable and secure to be included on the U.S. Treasury's balance sheet," he explained.

How Much Will the SEC Change Under Trump?

Among the most significant issues the crypto industry faced in recent years was what industry leaders and the majority of crypto users call a "regulatory overreach."

Trump has blasted the U.S. Securities and Exchange Commission (SEC) for its approach toward digital assets. Some of his allies have also done so, including several of his nominated cabinet members.

Pu believes Trump's history of pro-business policies and vocal support for financial innovation over the years will only be more apparent in his second term. "It's likely that the SEC, under someone like [Paul] Atkins, will prioritize issuing clear and transparent guidelines for cryptocurrency regulation," he said.

He noted that the timeline for new rulemaking is hard to predict, but it's reasonable to anticipate that in the near term, the SEC will "shift away from broad crackdowns on legitimate businesses within the crypto space."

Atkins' nomination by Trump to replace outgoing SEC Chair Gary Gensler was well embraced by the crypto community.

Will the U.S. Become the World's Crypto Leader Under Trump?

Trump promised during the campaign and after winning the presidency that he will "make crypto great again" in the country, pledging support for innovation and ensuring that growth and development in the blockchain and crypto markets will be centered in the United States.

Pu noted that the U.S. has already been a consistent leader in crypto innovation. "Many of the major advancements in Layer 1 infrastructure, decentralized finance (DeFi) systems, business models, and open-source development tools have originated in the U.S.," he pointed out.

The U.S. doesn't lack innovators, but over the past few years, there have been inconsistencies and a lack of clarity in regulatory policies that drove many American innovators to search for opportunities elsewhere.

With a more transparent and balanced regulatory framework, Pu believes the U.S. can retain its world-class innovators. Under Trump, the U.S. can "position itself as a global hub that attracts breakthroughs from around the world."

What About the Global Landscape?

Outside the U.S., regulation of digital assets and blockchain technology has been largely fragmented. Some countries, such as El Salvador and Bhutan, have embraced the revolution, while others are working toward more balanced regulatory frameworks that encourage innovation and protect investors at the same time.

However, there are also some jurisdictions that are still assessing the industry, and there are global agencies and organizations that have yet to warm up to crypto.

For instance, the International Monetary Fund (IMF) reacted negatively to El Salvador's adoption of Bitcoin as legal tender in 2021, threatening to withdraw or stall its funding package to the country over the Salvadoran government's move.

Pu expects things to change as Trump re-enters the White House. "We could reasonably expect regulatory agencies to adopt a less prosecutorial stance toward digital assets," he said.

"There is a strong possibility they will prioritize clear and transparent rulemaking to support industry growth," he projected.

In the most optimistic scenario, it's possible Trump will place crypto-specific legislation near the top of his first-year legislative agenda, Pu said. "Such actions could stabilize the digital asset landscape, effectively de-risking cryptocurrencies by making them more accessible and reducing their volatility. Additionally, by addressing regulatory uncertainty, these moves could reshape how institutions like the IMF evaluate digital assets, leading to more balanced considerations of their role in global finance," he added.

Key Trends That Will Shape Crypto in 2025

Several trends emerged in 2024 that fueled growth in the crypto industry, and this year, some segments are expected to balloon further than the others.

Pu projects that a particular key trend will shape crypto in 2025: DeFi incentives to drive the distribution and democratization of increasingly advanced and practical AI agents.

Already in the beginning of the year, AI agent tokens were surging, signaling increasing interest around the convergence of blockchain and AI.

Platforms like pump.fun also rapidly popularized simple meme tokens through unique UI/UX innovations and now projects such as Virtuals are building on that model by layer X (formerly Twitter) chatbots with similar financial incentives, effectively turning chatbots into viral assets, Pu said.

Moving forward, Pu expects a similar path. "The most successful innovations in 2025 will likely follow the same trajectory – using aggressive DeFi incentives to distribute increasingly sophisticated AI agents capable of performing diverse tasks like trading," he said.

Taraxa is at the center of this revolution. It supercharges DeFi and social AI ecosystems. The network has the lowest transaction fees over any Layer 1 or Layer 2 on the market and the lowest hardware requirements, positioning it at the forefront of world-first innovations.