Crypto bros need to temper their hopes for 2025: Andy Mukherjee
Crypto bros are heading into 2025 with great expectations. For the $135 million they have donated to President-elect Donald Trump and dozens of successful congressional campaigns, they want unhindered access to the global banking system and an end to lawsuits against the industry by the Securities and Exchange Commission. A strategic US reserve dedicated to Bitcoin will be the icing on their cake.
Don’t be surprised, however, if the actual outcome turns out to be less than a libertarian feast.
For one thing, the European Union is going the other way. New EU rules, which kicked in Dec. 30, require large stablecoins — tokens that facilitate trades in Bitcoin, Ether and other risky digital assets by converting 1:1 into dollar, euro or other fiat currencies — to park 60% of their reserves in bank accounts. That level of entanglement with the banking system will end up “creating an incredibly big systemic risk,” Tether Holdings Ltd. Chief Executive Officer Paolo Ardoino has argued. But noncompliance will make Tether’s USDT, the leading stablecoin, difficult for European investors to access. Banks are ready to slip into the void with rival products. Traditional finance may score a win over crypto firms.
And then there’s Asia, with its own
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