A Letter to President-Elect Trump From the Crypto Law Bar

In your keynote address at the Bitcoin conference in Nashville last year, you pledged to make the United States the crypto capital of the world if re-elected

As President-Elect Trump prepares to return to office on Monday, a group of crypto law practitioners have penned a letter to him outlining regulatory policies that they believe will help the United States become the crypto capital of the world.

“In your keynote address at the Bitcoin conference in Nashville last year, you pledged to make the United States the crypto capital of the world if re-elected for a second term,” the letter begins. “As you return to the presidential office this Monday, we write to you as practicing members of the crypto law bar to recommend regulatory policies that will help you to achieve that goal.”

The signatories go on to argue that the United States is “naturally positioned to lead the world in [crypto's] development,” but that regulators have “until now refused to adapt existing laws to digital assets and the blockchains that underpin them (or even to explain why not), and created an unfavorable business environment that has driven many entrepreneurs and developers abroad.”

To remedy this situation, the lawyers propose that the Trump administration pursue forward-looking policies across three areas:

- Supporting U.S. companies

- Promoting crypto values such as privacy, disintermediation, and decentralization

- Cultivating a favorable business environment domestically.

In the first area, the signatories suggest that the administration support U.S.-based businesses in the crypto industry by providing "clear rules of the road and proper regulatory guidance." They also recommend that Congress resist giving the U.S. securities laws an overbroad application, and that it be bold in its approach to crypto regulation, which includes not feeling bound by prior legislative efforts and also charting a unique path forward for the United States.

“General rules of the road,” they write, “are necessary, but your administration should also urge Congress and the relevant agencies to address specific sectors due to their strategic importance to the crypto industry and the nation. These include stablecoins, TradFi integration, and DeFi.”

In terms of fostering innovation through a commitment to crypto values, the lawyers argue that regulatory policy must show respect for crypto values, including privacy, disintermediation, and decentralization. They identify two key regulatory principles that arise from this commitment:

1. Regulation should not impose greater burdens on crypto where traditional analogs exist.

2. Regulation should evolve where traditional analogs are absent.

“When it comes to treating crypto the same as traditional assets and tools,” they continue, “the first principle impacts products like self-custody wallets, which enable users to hold and manage their own private keys. Because these tools are analogous to physical wallets used for personal asset management, they should not be treated any differently.”

The signatories also discuss the importance of treating crypto differently where traditional analogs are absent, arguing that this principle demands regulators resist placing crypto actors and activities into legacy frameworks that are incompatible with crypto.

“Regrettably, this is the path that many U.S. regulators have chosen,” they write. “The IRS has begun treating crypto front-ends as “brokers” absent statutory authority. The Department of Justice has begun charging non-custodial wallet developers with unlicensed money-transmission violations despite its longstanding policy to the contrary. And the U.S. Treasury has sanctioned the smart contract of privacy mixer Tornado Cash even though it is neither a foreign person nor property, but merely code. (An appellate court overturned the sanction.)”

Finally, the lawyers urge the Trump administration to create a welcoming business environment for crypto companies in the U.S. They recommend that the administration end the de-banking of crypto companies, improve SEC rule-making and enforcement, roll back punitive tax rules, and reduce unnecessary red tape.

“In pursuing the above forward-looking policies, we encourage your administration to consult with industry leaders and remain sensitive to the transnational scope of the digital asset ecosystem,” the letter concludes. “We also recommend leveraging devices, such as regulatory sandboxes, that limit the risk of unintended regulatory consequences. The time is ripe for the United States to begin asserting its global regulatory leadership. By ensuring that it does, your administration will be contributing to the country’s future economic prosperity and endorsing a technology that rests on deeply held American values and freedoms. You should seize the moment.”

The letter was signed by the following members of the Crypto Law Bar: Ivo Entchev, Olta Andoni, Stephen Rutenberg, Donna Redel, Mike Bacina, Joe Carlasare, Eli Cohen, Mike Frisch, Jason Gottlieb, Eric Hess, Katherine Kirkpatrick, Dan McAvoy, John McCarthy, Margaret Rosenfeld, Gabriel Shapiro, Ben Snipes, Noah Spaulding, Andrea Tinianow, Jenny Vatrenko, Collin Woodward, and Rafael Yakobi. The views represented and reflected upon are those of the signatories and not necessarily of their employers.