FILE PHOTO: Republican presidential nominee and former U.S. President Donald Trump gestures at the Bitcoin 2024 event in Nashville, Tennessee, U.S., July 27, 2024. REUTERS/Kevin Wurm/File Photo
NEW YORK/SINGAPORE/PARIS (Reuters) -Bitcoin, the world's largest cryptocurrency, approached the previous session's record high on Tuesday in choppy trading as the top U.S. markets regulator unveiled a plan to overhaul rules for the sector.
Bitcoin hit a record high $109,071 on Monday when Trump, who has pledged to be a "crypto president," was sworn in, but sank when crypto was not included in a flurry of executive actions on Day One.
Bitcoin prices rose 3.8% while Ethereum , the second-largest cryptocurrency, gained 1.4% as the market shook off some of that disappointment.
The Securities and Exchange Commission's new leadership said on Tuesday it had created a task force to develop a regulatory framework for digital assets, the first major move by Trump's new administration to overhaul crypto policy.
"The president has moved quickly on his agenda," Coinbase Chief Legal Officer Paul Grewal said in a phone interview. "The SEC has made it clear they understand that and want to be a part of that."
Some analysts warned, however, of volatility until Trump's administration starts to announce concrete policies long hoped for by the crypto industry.
"The digital asset market is disappointed to not have been mentioned in the inauguration speech or Day One executive orders," said Geoffrey Kendrick, global head of digital assets research at Standard Chartered.
"I suspect Bitcoin will end up going lower so long as we get no news from Trump on digital assets. A break back below $100,000 seems inevitable."
Trump's own $TRUMP-branded "meme coin," launched on Friday evening, fell on Tuesday, according to cryptocurrency price tracker CoinMarketCap.
World Liberty Financial, a separate Trump-linked crypto project, also said on Monday it had completed an initial token sale, raising $300 million, and that it would issue additional tokens. Trump has pledged to hand management of his assets to his children, but ethics experts have criticized his crypto ventures as raising conflict of interest issues and stoking speculation in a volatile asset class.
Acting SEC Chair Mark Uyeda's office said on Tuesday the agency's new task force would help to draw clear regulatory lines, provide paths to registration, craft disclosure frameworks and deploy enforcement resources.
Reuters reported earlier this month that Uyeda and fellow Republican Commissioner Hester Peirce were poised to kickstart the crypto policy overhaul.
Trump is also still expected to issue executive orders in coming days that will further promote Bitcoin adoption, Reuters and other media outlets have reported.
Speaking to Reuters Global Markets Forum at the start of this week's World Economic Forum's annual meeting in Davos, Jeremy Allaire, CEO of stablecoin issuer Circle, said he expected imminent executive orders that could allow banks to trade crypto, offer crypto investments to wealthy clients and hold it in portfolios.
(Reporting by Chibuike Oguh and Chris Prentice in New York and Tom Westbrook in Singapore; Additional reporting by Hannah Lang and Michelle Conlin in New York, Elizabeth Howcroft in Paris and Vidya Ranganathan in Singapore; Editing by Michelle Price, Jacqueline Wong, Susan Fenton, Matthew Lewis and Richard Chang)
