Gensler’s Gray Area: Will Trump Bring Clarity to Crypto?
RWA Alpha
4 min read
CEOs, developers, and investors alike have faced years of vocal frustration over America's perceived failure to establish clear regulatory guidelines for cryptocurrency and blockchain technology. With a decisive election returning Donald Trump to the presidency in 2025, and SEC Chair Gensler's resignation taking effect on Monday, one question looms over crypto participants: will the SEC put an end to Gensler's 'gray area' and deliver the regulatory clarity that both CEOs and investors have been seeking?
When it comes to Real World Asset (RWA) projects, which tokenize tangible goods like real estate, commodities, art, and energy, regulatory uncertainty presents both challenges and opportunities. The competing priorities among U.S. federal agencies and the lack of clear legislation have intensified questions regarding the nation's approach to emerging technologies and its global competitiveness.
If the United States intends to hold its position as a global financial and technological leader, addressing regulatory issues could make all the difference. For now, only the most risk-tolerant investors seem willing to navigate the rollercoaster of decentralized finance (DeFi)—a market often criticized for its lack of transparency. Corporate players, unable to risk inadvertently engaging with bad actors, are sidelined by what can feel like the 'wild west' of modern finance.
The regulatory environment for blockchain in the U.S. remains disjointed, fueling arguments for a more streamlined approach to oversight. Agencies like the Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC), the Internal Revenue Service (IRS), the Financial Crimes Enforcement Network (FinCEN), and the Office of the Comptroller of the Currency (OCC) all claim jurisdiction over various aspects of the crypto sector. This overlapping authority has led to what many can only describe as a 'regulatory turf war.’
SEC Chair Gary Gensler has been a controversial figure, widely criticized for his aggressive enforcement actions and blanket criticisms of participants in the crypto space. President-elect Donald Trump, who has openly criticized Gensler, stated he would fire him on his first day in office. However, Gensler announced he will step down on the day of Trump's inauguration, preempting any such move.
Hester Peirce, a popular SEC Commissioner and outspoken critic of Gensler’s methods, has noted, “Instead of providing regulatory clarity, we’ve embraced enforcement as a way to punish innovation rather than guide it.” Economists and industry leaders agree that this piecemeal approach, combined with the absence of comprehensive legislation, has significantly hindered growth. Crypto enthusiasts hope to see Peirce take a more leading role and put her mark on clear crypto guidelines.
In the meantime, many CEOs are operating in crypto-friendly regions that have moved swiftly to establish clear regulatory guidelines. Examples include Switzerland’s Financial Market Supervisory Authority (FINMA), which implemented straightforward rules for tokenized securities, while Singapore’s Monetary Authority of Singapore (MAS) offers regulatory sandboxes and detailed licensing regimes. The European Union’s Markets in Crypto-Assets (MiCA) regulation harmonizes crypto laws across member states.
For RWA projects, interest in compliance is particularly high. Tokenizing tangible goods like real estate or art offers owners a path to unlocking liquidity, yet American regulations make it difficult for these projects to operate even domestically. Without definitive rules, RWA issuers face the constant risk of falling afoul of securities laws, which increases compliance costs and deters potential entrants.
Trump’s return to the presidency brings speculation about how his administration might approach these issues. Donald Trump himself has expressed optimism about the potential of blockchain technology, stating at the Bitcoin conference in Nashville, “If crypto is going to define the future, I want it mined, minted, and made in the USA.” This sentiment reinforces expectations that his administration may take a more proactive role in clarifying regulations for the crypto sector. However, the speed at which clarity will come remains guesswork.
J.D. Vance, the Vice President-elect, is well known for his bullish views on crypto. Just take a scroll through Vance's past involvement with crypto initiatives on social media, and you'll identify his belief in the sector's potential for economic growth. The growing importance of blockchain technology and tokenized assets in the global economy, combined with a new American administration, should prompt a more decisive stance. Industry leaders anticipate that Trump's pro-business orientation could lead to policies encouraging innovation while maintaining oversight to protect investors.
One possibility is a push for legislative clarity. Bills like the Digital Commodity Exchange Act, which seeks to provide a clear framework for classifying digital assets, could gain renewed attention under a Trump administration. Such legislation would be a significant step toward reducing ambiguity for RWA projects and the broader blockchain ecosystem.
For investors and developers in the RWA space, America remains both a land of opportunity and a source of frustration. As we enter 2025, the future of blockchain technology rooted in the U.S. hangs in the balance. Trump's administration has the potential to bring much-needed clarity to the regulatory landscape, but whether it will prioritize this issue remains uncertain. What is certain is that crypto investors globally will be celebrating Gensler's resignation on Monday as they realize a win they've been envisioning for years.
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Disclaimer: Please note, none of this article is to be construed as financial advice or an endorsement to purchase any digital assets. Do your own research and consult a professional financial advisor prior to making any investments.
Disclosure: The author(s) of this article may have a financial interest in the token of the company or blockchain covered in this publication. The views expressed in this article accurately reflect the personal views of the author(s) about the subject, securities, or issuers, and no part of the compensation of the author(s) was, is, or will be directly or indirectly related to the inclusion of specific recommendations or views in this commentary. The author(s) may hold a long/short position in the token of the blockchain or company (if any) discussed in this article, and as content contributors, they are not subject to no-trade lists.
