Kevin Wurm/Reuters
President-elect Donald Trump has promised to protect the right to own bitcoin and promote innovation in the blockchain space.
Cryptocurrency evangelists have already taken him at his word. The ensuing Trump-bitcoin honeymoon period has driven bitcoin to about $100,000, up 42 percent since the US election results.
But the question is, what does Trump mean by “innovation in the blockchain space”? And how will it affect global investors and industries?
The answer lies here: Blockchain can revolutionise industries which rely on trusted data, such as supply chain management, environmental, social and governance metrics, and regulatory compliance.
Bitcoin may be the original, speculative crypto based on blockchain, but it runs on a data mining algorithm, which makes it slow, costly and energy-intensive.
Therefore, true innovation is more likely to come from the broader cryptocurrency market, valued at approximately $1.5 trillion, with assets like ethereum and algorand leading the charge.
For example, ethereum’s market value is only around $400 million, a fifth of bitcoin’s, yet it and other similar programmable cryptos can support innovation.
Trump-inspired policy can lay the foundations for a digital asset marketplace
Ethereum can automate transactions by storing computer code which creates smart contracts, eliminating the role of an intermediary. This makes it an ideal coding language for decentralised finance, where the technology improves alongside the underlying infrastructure.
Similarly, other coins like algorand support supply chain data for regulatory compliance and carbon tracking in real-world use cases rather than speculation.
These programmable tokens can link actual demand and supply, setting a real price for each token. Once a fair price is established, new business models can be created, such as linking carbon sequestration with a token which can then be sold to end investors.
It is in this wider arena where the new Trump-inspired policy can lay the foundations for a digital asset marketplace (something that is only digital and that exists on a blockchain).
Achieving this, however, hinges on establishing a transparent and trusted regulatory framework – one that protects against bad actors while nurturing private-sector innovation.
Here, Trump can look to the Emirates for inspiration. Currently, the UAE is one of the top-ranking countries globally for adoption of crypto. Around 35 percent of the population own a currency, nearly double that of the US.
The UAE also offers a compelling regulatory blueprint. Its Virtual Assets Regulatory Authority (Vara) is the world’s first regulator exclusively focused on virtual assets.
Vara’s approach fosters innovation while maintaining responsible oversight, positioning the UAE as a hub for crypto businesses.
The Middle East ranks seventh globally for crypto assets, with $400 billion in on-chain value as of mid-2024. This figure is expected to grow substantially as the region capitalises on its enthusiasm for blockchain technology.
As the UAE has demonstrated, a well-designed regulatory framework offers a competitive advantage by attracting talent and investment. However, on the flip side, poorly-designed regulation risks driving away innovation and undermining long-term gains.
Thoughtful policies can legitimise crypto as an asset class, setting a floor on its value and paving the way for blockchain’s broader adoption.
While bitcoin’s ups and downs may grab headlines, real innovation lies in programmable cryptos and their ability to solve real-world problems.
Trump’s endorsement of blockchain is highly likely to catalyse the global market – including the Middle East. Over time, crypto could become a safer, transparent, and viable asset class for storing value and innovation.
This, in turn, will drive blockchain adoption.
If blockchain is good enough for safeguarding your money, then it’s good enough for transforming industries. Watch this space as blockchain technologies underpin the Trump-inspired data economy.
Nish Kotecha is a serial tech entrepreneur and former investment banker. He is the chair and co-founder of Finboot, chair of Agam.ai and on the advisory board of Innoviti
