Trump II offers crypto regulatory wins — and big reputational risks

Market watchdogs are working together, IPOs are back, and Polymarket is eyeing a U.S. return. But the First Family's grifting looms large.

By Peter A. McKay | About | Follow: Email: peter[at]pmckay[dot]com

Photo by Mae Mu via Unsplash.


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The second Trump administration continues to be a surprisingly mixed bag for the crypto industry, whose donors heavily backed the president's campaign in 2024.

As has been the case since the new term's early days, the latest wins for the industry are mostly in the regulatory arena:

  • The Securities and Exchange Commission and the Commodity Futures Trading Commission jointly announced a conference Sept. 29 to better "harmonize" their oversight of crypto. On Capitol hill, the latest draft of the Senate's crypto bill proposes creating a standing committee to avoid future turf wars between the market watchdog agencies over crypto.
  • Polymarket, a popular on-chain prediction platform, said it is planning to re-enter the U.S. market after receiving a no-action letter from the CFTC, meaning that the agency doesn't intend to pursue any enforcement actions against its prediction contracts.
  • Lighter regulation has also emboldened several crypto companies this year to make traditional stock offerings on Wall Street exchanges. The latest: Shares of Solana treasury company SOL Strategies are expected to begin trading on Nasdaq this week. Separately, the Winklevoss brothers' Gemini Space Station, a crypto exchange and custodian firm, registered with the SEC on Friday to do an initial public offering (IPO) of shares soon, pending the regulator's approval.

On a less promising note, however, there are Trump's increasingly erratic economic policies and constant shirking of the free-market principles traditionally associated with conservative administrations.

There's also the Trump family's incessant self-dealing, much of it in the crypto arena. We got another reminder of that on Monday, when the governance token for Trump-backed World Liberty Financial began trading. The tokens immediately leapt in value, but by Thursday they had already fallen 50% off their highs, no doubt costing a lot of late-stage investors significant money.

But for the early investors, it's all been awesome. On Saturday, Bloomberg News reported that the Trump family had raked in $1.3 billion in just a few weeks from just two crypto ventures — World Liberty and the mining firm American Bitcoin.

As someone who's previously done marketing work for several crypto organizations, I have to say I'm concerned the industry has wandered into a reputational minefield here that's going to be very prolonged and painful to deal with.

To put it bluntly, the juxtaposition this week between the WLFI token launch (which enriched the Trumps) and surprisingly weak jobs data for the U.S. economy (which impoverishes a lot of everyday Americans) is striking.

A lot of the general public probably hasn't quite connected those dots yet. But as a similar pattern repeats in the months ahead, they eventually will.

Keep in mind, Trump's protectionist, anxiety-inducing policies and general chaos will continue to take an economic toll. And he will keep lining his pocket. So there is yet ample time for people to catch on.

And some portion of the ire that results will likely be directed at the crypto industry writ large, since it has supported Trump so publicly. I don't know if we're prepared for that public ire, frankly.

To put it a different way: During the Biden administration, the most notorious bad actor in the crypto space as far as the general public was concerned was FTX's Sam Bankman-Fried. After his company collapsed in late 2022, he cast quite a long shadow over the entire industry, as anyone who was active at the time will loudly attest.

For normies, Bankman-Fried effectively became the face of crypto for a long time, in the worst possible way. This in turn had a very real effect on user adoption, product launches, fundraising, and so on.

By the end of the second Trump administration, the president himself could very well end up playing a similar role. If so, the public fallout for the entire crypto industry could make FTX's collapse look like a day at the beach near FTX's old headquarters in the Bahamas.

Now is the time to get ready.

Five Things: Aug. 31 to Sept. 6, 2025

  • Retail-sized stablecoin transfers of $250 or less have hit new records this year, including $5.8 billion in activity in August. The torrid volume signals strong adoption among everyday users. (CoinDesk)
  • A large Ethereum whale just moved $645 million worth of ETH tokens from three long-dormant wallets to a staking service, according to on-chain data. (Decrypt)
  • Anthropic agreed to pay $1.5 billion to settle a copyright infringement lawsuit brought by a group of authors, marking the first such settlement of the AI boom. (NPR)
  • The benchmark S&P 500 is now more expensive relative to its component companies' sales than it was during the 1990s dotcom bubble. Yikes. (Wall Street Journal)
  • Nevada police identified the man recently murdered at Burning Man as Vadim Kruglov, a 37-year-old Russian national. Friends have launched a GoFundMe campaign to repatriate his body to his hometown of Omsk, Russia. The Pershing County Sheriff’s Office is asking anyone with information related to Kruglov's death to contact investigators at 775-273-2641, referencing case #25-318.

Market Snapshot

A quick look at some major indicators as of Friday's close on Wall Street:

Indicator Close Weekly YTD
Bitcoin $111,609.98 +3.4% +18.9%
Nasdaq 100 23,652.44 +1% +12.6%
Gold $3,653.30/oz +3.9% +39%
USD Index 97.74 -0.1% -9.9%
10-yr U.S.
Treasury Yield		 4.086% -0.141 -0.487

Looking Ahead

  • The Linea Network, a Consensys-backed project designed to extend and scale Ethereum's capabilities as an app platform, is expected to launch this week, including an airdrop of its own token to prospective users. (Decrypt)
  • Tether, the world's largest stablecoin issuer, is reportedly considering a significant increase in its gold holdings. Such a strategy would represent a decidedly old-school way to improve the financial backing of Tether's digital USDT token. (The Block)
  • Two new research papers suggest there have been significant strides in developing emotionally intelligent AI agents, including distinct, consistent personalities for bots depending on their training. (Decrypt)

Odds & Ends

  • Egyptian authorities raided and shut down Streameast, believed to be the internet's largest platform for pirating sports broadcasts. (Variety)
  • Author Samuel Hawley says we owe a 16th-century Japanese warlord some thanks for the current global matcha shortage.

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