Bitcoins Last Barrier to $5M: Trumps Bold Executive Order to Unlock Crypto Custody in Banks
- Trumps order may reverse SAB 121, allowing banks to hold crypto.
- Repeal could pave the way for wider institutional crypto adoption.
- Industry leaders push for changes to boost Bitcoins mainstream value.
As President-elect Donald Trump prepares to take office, he may sign an executive order that transforms the financial landscape. His plan could allow banks to hold Bitcoin and other cryptocurrencies, boosting crypto adoption across the country.
Bitcoin Bank Custody
President-elect Donald Trump may sign an executive order on his first day in office, allowing banks to hold Bitcoin and other crypto assets on behalf of clients. This move could reverse existing regulations that limit how financial institutions manage digital assets. The order seeks to address a controversial accounting policy and pave the way for crypto adoption in mainstream financial services.
The Staff Accounting Bulletin 121 (SAB 121) policy hinders banks from entering the digital asset space. It requires financial institutions to record any crypto assets they hold for customers as liabilities on the banks balance sheet. This has led to concerns of misrepresentation of the financial status of banks and discourages them from offering crypto-related services.
Trumps executive order would challenge the SAB 121 regulation. His administration is reportedly preparing to address de-banking issues and create a favorable environment for cryptocurrency services. Experts believe that repealing the SAB 121 could remove the barriers that prevent banks from offering digital asset custody services.
Trumps Busy Bitcoin day in office
Trumps administration is poised to implement changes that could align with the growing demand for crypto services in the United States. The expected changes follow recent legislative efforts to repeal the crypto accounting rule, though those efforts were blocked by President Joe Biden. The crypto industry has strongly advocated for these changes to improve regulatory clarity and enhance access to banking services.
In addition to the executive order, Trump is also focused on attracting institutional investors to the crypto space in the U.S. Trumps pro-crypto team has considered creating a Bitcoin stockpile, allowing firms to hold Bitcoin as a reserve asset. A significant shift towards favourable crypto banking policies could result in increased institutional adoption of Bitcoin and other cryptocurrencies.
Impact to Bitcoin market
The repeal of SAB 121 regulation could lead to a significant shift in how cryptocurrencies are integrated into traditional financial systems. The repeal could also make it easier for banks to offer cryptocurrency services, increasing access for both businesses and consumers. Financial institutions might be more inclined to hold Bitcoin and other digital assets, boosting trust and credibility in the crypto market.
The order is expected to influence the operations of banks and financial institutions. Crypto advocates argue that lifting such restrictions would boost innovation and investment in the digital asset sector. Additionally, it could allow cryptocurrency businesses to operate more freely, increasing competition and innovation.
Industry leaders, such as Michael Saylor, have emphasized that several factors could propel Bitcoins value to new highs of $5M. These include the approval of a spot Bitcoin ETF, which would allow institutional investors to gain exposure to the asset. Additionally, changes to FASB financial reporting rules such as allowing BTC to be marked at fair value, would also improve its appeal.
Read more: https://www.tronweekly.com/trumps-order-could-drive-bitcoin-momentum-in-us/
Text source: TronWeekly
