What Policy Signals Does The White House Crypto Summit Release?

[TL；DR]:

After the first crypto summit at the White House ended on March 7, Bitcoin turned from rising to falling, and once fell below the integer mark of $80,000, setting a new low in nearly 5 months.

According to the utive order, the initial capital of the strategic Bitcoin reserve will come from bitcoins confiscated by the government through criminal and civil forfeiture procedures, with an estimated size of approximately 200,000 coins, which will reduce selling pressure by approximately $18 billion.

The digestion of positive news after the summit naturally led to a market decline, but the long-term positive news has already taken shape, which may be the most worth looking forward to for long-term investors.

Introduction

Last Friday, the White House held its first crypto summit, marking a new phase in the U.S. crypto policy. Before the summit, President Trump established a strategic Bitcoin reserve through an utive order and signed an utive order supporting cryptocurrency, pushing the price of Bitcoin to over $91,000. However, after the summit, the market quickly turned cold, and the price of Bitcoin fell to $86,500. Market comments shifted from favorable policies to fierce debates about expected overdrafts and regulatory concerns.

The Market Fluctuates Around the Crypto Summit

Since March, the market has focused on the first crypto summit after Trump took office. As a warm-up, Trump first sent three tweets on the X platform. He wrote: “Emphasizing that valuable cryptocurrencies such as BTC and ETH will become core reserve assets”, “End the war on cryptocurrencies, support innovation, and put America first!”, “Major policies will be announced at the summit on March 7, so stay tuned!” These remarks continued his consistent pro-crypto stance and successfully led to a wave of gains in the crypto market. The author previously wrote an article, “Crypto Strategic Reserve Launched, Is It A Day Trip for Trump Season?“ to discuss this.

Source: @realDonaldTrump

Previously, at the Bitcoin Nashville Conference in July 2024, Trump promised to promote crypto-friendly policies if elected; on election night in November 2024, Bitcoin broke through $74,000, and in the following months, it broke through the $80,000, $90,000, and $100,000 levels, showing its influence.

The market’s bet on Trump Season stems from multiple expectations. First, Trump’s concept of a strategic reserve of cryptocurrencies is interpreted as the United States holding crypto assets in the same way as the gold reserve model, and may purchase Bitcoin through the Treasury’s Exchange Stabilization Fund (ESF) to enhance the competitiveness of the U.S. dollar. Secondly, as the summit approaches, investors generally believe that the summit will introduce specific policies, such as clarifying stablecoin regulation and promoting congressional legislation. Everyone began to bet on regulatory relaxation and tax incentives, believing this would inject long-term momentum into the industry.

Source: ABCNews

However, the market suddenly changed after the summit ended on March 7. On the day of the summit, March 7, Bitcoin fell for four consecutive days, erasing all the gains in the previous week and hitting a new low of $76,000 in nearly five months. At the same time, ETH fell below $2,000, SOL fell to $111, and ADA fell to $0.65. The recent declines were above 20%, and investor sentiment turned from enthusiasm to wait-and-see.

Source: Gate.io

However, crypto analyst PlanB said, “The summit confirmed the national strategic status of crypto, and short-term fluctuations will not affect the overall situation.” The Wall Street Journal columnist James Rickards was more critical: “The summit stated a lot but did not do much, and the market was fooled.” The reasons for the decline include short-term profit-taking and dissatisfaction with the vague content of the summit, which will be elaborated on below.

What Was Discussed At the First Crypto Summit?

The first White House Crypto Summit lasted 4 hours and was attended by about 30 people, including government officials and industry representatives. The meeting was hosted by David Sacks, the White House’s head of artificial intelligence and cryptocurrency. Participants included Coinbase, Kraken, Fidelity, BlackRock, etc., and blockchain developer representatives came from the Ethereum Foundation and Solana Labs. The following is the core content of the summit:

1. Crypto Strategic Reserve Plan
In his opening speech, Trump announced that the United States will explore the accumulation of Bitcoin and other crypto assets to establish the “U.S. Digital Asset Vault”. He said: “Just like we hold gold, cryptocurrencies will become part of the national reserve, and the first pilot will focus on Bitcoin.” According to the utive order, the initial capital of the strategic Bitcoin reserve will come from Bitcoins confiscated by the government through criminal and civil forfeiture procedures, with an estimated size of about 200,000, which will reduce the selling pressure of about $18 billion. The Trump administration promised not to sell these Bitcoins, but to maintain them as long-term reserve assets.

Source: @jconorgrogan

2. Promote stablecoin legislation
In addition to establishing a strategic Bitcoin reserve, the summit also focused on stablecoin legislation. The Trump administration has made it clear that it will push Congress to introduce stablecoin-related regulations as soon as possible to create conditions for applying stablecoins in payment s and financial products. This move is expected to bring a clearer regulatory framework and broader development space to the stablecoin market.

3. Improve tax policies
Tax policy was another topic of great concern during the summit. According to people familiar with the matter, the U.S. Internal Revenue Service (IRS) plans to revoke or modify previous tax guidance on digital assets to reduce tax uncertainty in the market. This move is expected to provide crypto investors with a clearer and more transparent tax policy environment and further stimulate market vitality.

4. Strengthen cross-departmental coordination and cooperation
The summit also emphasized the importance of cross-departmental coordination and cooperation. To promote the healthy development of the crypto industry, the Trump administration will strengthen communication and collaboration between the Treasury Department, the Commerce Department, the Internal Revenue Service, the Office of the Comptroller of the Currency, and other departments to jointly formulate more scientific and reasonable regulatory policies. At the same time, the government will also actively cooperate and communicate with the international community to jointly respond to the challenges and opportunities of the global crypto market.

Objectively speaking, this summit’s content is mostly directional guidance, lacking specific implementation details. The regulatory framework that everyone had previously considered is only at the discussion stage. This ambiguity directly affects market confidence. As Chainalysis said, “The pre-summit rally was largely due to an over-interpretation of Trump’s tweets, and the policy signals of the summit itself are relatively vague, and the market needs more time to digest them.”

Market Game Between Long-term Benefits and Short-term Disadvantages

The convening of the White House Crypto Summit is undoubtedly a milestone event for the crypto industry, and the policy signals it released were quickly reflected in the crypto market. In the short term, this summit failed to continue the previous upward trend of the market, and the price of cryptocurrencies fell instead, which is closely related to the market’s early digestion of the positive news. In the pre-summit tweet boom, investors have fully factored Trump’s supportive remarks into the price, and the summit itself did not bring about a substantial breakthrough beyond expectations, resulting in a situation where “good news is all bad news.”

However, from a long-term perspective, the policy signals of the summit have undoubtedly laid a positive foundation for the development of the industry. The author believes that the strategic reserve plan and regulatory framework optimization signals released by the summit reflect the strategic importance the US government attaches to cryptocurrencies. The Bitcoin Strategic Reserve Plan positions Bitcoin as a national asset class, and its symbolic significance is greater than the actual size of holdings. This shift not only enhances its market position, but may also promote other countries worldwide to follow suit. For example, after the meeting, it was reported that Korean financial experts and opposition lawmakers called for the consideration of establishing Bitcoin reserves, and Metaplanet CEO also called on Japan to follow the United States in establishing Bitcoin reserves.

Source: decrypt.co

Secondly, improving the regulatory framework will accelerate institutional adoption. For example, just after this summit, the Texas Senate advanced the Bitcoin Reserve Act with bipartisan support, and the Utah Senate passed the Bitcoin Act. With the implementation of the new policy, it is expected that in the next two years, pension funds, hedge funds, etc. will also gradually be allocated to the crypto market.

Source: bitcoinlaws.io

However, the uncertainty of policy implementation remains a key challenge. For example, Jacob King, founder of WhaleWire, pessimistically stated that the bear market for Bitcoin has arrived. The failed launch of the Bitcoin Strategic Reserve clearly shows that there was never an intention to purchase any other assets except the confiscated Bitcoin. At the same time, the argument for institutional demand has collapsed, as evidenced by the record outflow of ETF funds.

Source: @JacobKinge

In summary, the White House Crypto Summit released policy signals to support industry development, establish a regulatory framework, promote technological integration, and experimented to integrate crypto assets into the sovereign fiscal . Trump’s tweets before the summit triggered a market boom, and the digestion of positive news after the summit naturally led to a market decline. Still, long-term positive news has already taken shape, which may be the most worth looking forward to for long-term investors.