EXCLUSIVE: 'Crypto Czar' Charm Offensive Welcomed, But Experts Wonder: Will US Policy Deliver?

The digital asset community is approaching the newfound embrace of crypto by the Trump administration with cautious optimism, after a Tuesday press conference led by David Sacks, the designated “Crypto Czar.”

What Happened: While the rhetoric surrounding innovation and regulatory clarity has been well-received, industry experts are now scrutinizing the actual plans and questioning whether the proposed changes will truly benefit the broader crypto ecosystem.

Experts see this as a critical juncture, but they also caution against potential pitfalls.

The formation of a bipartisan working group was a central announcement, signaling an effort to harmonize regulatory efforts across Congress and the executive branch.

The initiative aims to create a framework for stablecoins and market structure legislation, which could have profound implications for the global financial system.

Speaking with Benzinga, Todd Ruoff, CEO of Autonomys, pointed out the measured approach outlined by Sacks.

"Lawmakers are ‘exploring the possibilities,'" Ruoff said, noting that the emphasis was on forming committees, educating Congress, and determining the feasibility of frameworks.

While these early steps are crucial, Ruoff highlighted the economic implications of stablecoin legislation.

"Higher demand for T-bills would cause their prices to go up, which in turn pushes yields down and lowers interest rates," he said.

This approach could tie stablecoin adoption directly to the strength of the U.S. dollar and the Treasury market.

Notably, stablecoins could serve as both a technological and economic tool.

By linking their reserve requirements to U.S. Treasuries, stablecoins could provide a new channel for Treasury demand, reinforcing the dollar's dominance.

However, this integration would require careful calibration to avoid market distortions, especially given the size of the stablecoin market, which currently exceeds $227 billion.

Paul Neuner, founder of Telcoin, told Benzinga the announcement marks a turning point for crypto in the U.S., where regulators are no longer trying to suppress innovation but are instead working to position the country at the center of digital assets.

He drew parallels to the regulatory evolution seen during the rise of Web 2.0, emphasizing that crypto regulation should focus on gateways like digital asset banks rather than attempting to control decentralized networks.

The media briefing also highlights a shift in regulatory thinking.

Instead of enforcing broad restrictions, the focus on key entry points like digital asset banks suggests a pragmatic approach.

This strategy could ensure compliance without stifling innovation, fostering an environment where blockchain-based financial services can thrive alongside traditional systems.

Joao Reginatto, Chief Strategy Officer at M^0, praised the administration's progress on stablecoin clarity.

"The pace with which the Trump administration is moving through the phases is welcomed by the sector," Reginatto told Benzinga.

He highlighted the balance between federal oversight and flexibility for state regulators, calling it a "reasonable approach."

Also Read: EXCLUSIVE: Anthony Scaramucci Warns Donald Trump’s Crypto Promises May Be A ‘Mirage’

Why It Matters: Experts point to a potential decentralization of stablecoin oversight, with state regulators playing a significant role.

This could align with the broader U.S. tradition of federalism while addressing the specific needs of different jurisdictions.

However, it also raises questions about uniformity and consistency, particularly for large-scale issuers operating across states.

Speaking with Benzinga, Laurenth Alba, Head of Business Development at Rome Protocol, sees the bipartisan effort as a clear sign of crypto's growing importance and said the bipartisan working group and Senate stablecoin bill suggest that crypto is now a national economic and geopolitical priority, not just a speculative asset class.

However, she warned that overregulation could drive users toward decentralized alternatives. "The real threat to dollar hegemony isn't crypto—it's bad policy that pushes financial innovation beyond U.S. control."

There is a delicate balance regulators must strike.

While integrating stablecoins into the financial system could bolster the dollar's dominance, excessive control risks alienating innovators and users.

This could create an unintended shift toward decentralized stablecoins or alternative financial systems, eroding the very dominance the U.S. seeks to strengthen.

Alice Liu, Research Lead at CoinMarketCap, acknowledged the administration's recognition of past regulatory missteps.

"David Sacks and team acknowledged past policies have been inconsistent and, at times, arbitrary—pushing crypto innovation offshore," Liu told Benzinga.

She emphasized that the focus on stablecoins is a logical first step, given their role in global financial markets.

However, Liu noted a missed opportunity in the absence of a clearer plan for Bitcoin reserves, which some stakeholders had anticipated.

While stablecoin regulation is critical, Bitcoin remains central to the crypto ecosystem.

A well-defined policy on Bitcoin could provide additional clarity, particularly as other nations explore BTC as a reserve asset.

Dave Sedacca, Head of Finance at Parity Technologies, viewed the announcement as a positive step but noted market expectations for more impactful measures.

"The emphasis on reinforcing the dollar from a digital perspective was encouraging, and it will be intriguing to see how the BRICS nations respond," Sedacca said.

As BRICS nations explore alternatives to the dollar, the U.S.'s focus on digital assets could serve as a counterbalance.

However, this will require swift and effective action to avoid falling behind in the global financial race.

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