Cryptocurrency-related stock prices jumped as the broader market reacted positively to President Joe Biden’s long-awaited executive order requiring U.S. federal agencies to create a regulatory framework for digital assets as well as to explore the future digital dollar.
Coinbase (COIN) was up 10.5% by close of the market, while shares of MicroStrategy (MSTR) of Bitcoin evangelist Michael Saylor were up 6.4%, according to TradingView.
Blockchain-linked exchange-traded funds (ETFs) also saw renewed market confidence in the cryptocurrency, with the ProShares Bitcoin Strategy (BITO) ETF gaining 10% and the Valkyrie Bitcoin Strategy (BTF) ETF closing up 10.3%.
Cryptocurrency mining companies showed the greatest growth: shares of Riot Blockchain Inc. (RIOT) rose 11.2%, while shares of Marathon Digital Holdings Inc. (MARA) rose 13.5% thanks to Jefferies (JEF) analyst Jonathan Peterson, who reportedly restored his buy rating for MARA in a note. customers and stating that cryptocurrency miners are likely to benefit now that the US government “more formally recognizes, interacts with, and appears to support” the digital asset industry.
While 10% fluctuations are common in cryptocurrencies, they are unusually volatile movements in traditional markets. And despite gains over the past day, Coinbase is still down almost 48% from its direct listing price last April, while RIOT is in an even worse position: it is currently down 76% from with the latest high in February 2021.
Bitcoin (BTC) itself jumped 9% after an executive order was leaked last night before returning to its current 5% gain.
Aside from the immediate positive price action, most investors considered the executive order to be, if not a net positive for the cryptocurrency industry, then at least far less bad than they feared. President Biden called the rise of digital assets “an opportunity to solidify American leadership in the global financial system and at the forefront of technology.”
The order did not explicitly state what regulatory action could be expected, but the overall sentiment of the US federal government seemed to be constructive – meaning that the executive order would potentially help expand the use of virtual currencies in the US financial system.
It was also supported by Treasury Secretary Janet Yellen, who said in a statement that the legislation would help consumers and businesses.
“President Biden’s historic executive order calls for a coordinated and comprehensive approach to digital asset policy,” Yellen said. “This approach will support responsible innovation that can deliver significant benefits to the nation, consumers and businesses.”
Minnesota Congressman Tom Emmer detailed the areas that were glossed over by the executive order, warning his 48,000 Twitter followers that they have no reason to expect the US government to prioritize open, unauthorized, or proprietary technology policies.
RELATED: Cryptocurrency Could Bypass President Biden’s ‘Devastating’ Sanctions on Russian Banks and Elites: Report
1) Decentralization is the point: The PR never mentions decentralization. De-intermediating our economy will allow all Americans, no matter the circumstances, to decide their future, not a bank, big tech, or government. — Tom Emmer (@RepTomEmmer) March 10, 2022
He added, however, that one of the most promising parts of the executive order was that it “does not require the SEC to weigh in. SEC Chairman Gensler has spent the past year bullying crypto innovators and entrepreneurs with his unproductive regulation through public statements and enforcement. action. His contribution is not decisive.”
Gensler commented on the news anyway, opting to tweet his support for Biden’s regulatory efforts.
@POTUS signed a decree on crypto assets today. I look forward to working with colleagues in government to achieve important public policy goals: protecting investors and consumers, protecting against illegal activities, and helping to ensure financial stability.” — Gary Gensler (@GaryGensler), March 9, 2022
Gensler’s tweet was met with criticism from some in the cryptocurrency community on Twitter, given his oft-voiced skepticism about the digital asset industry.
Ryan Selkis, CEO of Messario Crypto, put Gensler in the crosshairs, saying that Gensler’s goals have nothing to do with protecting investors.
If you are lucky, you will be completely deprived of a meaningful contribution, since your personal goals have nothing to do with investor protection, market stability, or blocking illegal activities. It is fitting that you say nothing here about capital accumulation. Keep promoting CCP companies through crypto! — Ryan Selkis (@twobitidiot) March 9, 2022
Overall, the stock market rose on Wednesday, with the S&P 500 gaining 2.5% despite continued geopolitical tensions in Eastern Europe.
