In the largest economic power in the world, the United States, a new panorama is emerging for the cryptocurrency market that has promising effects.

Former president and Republican presidential candidate Donald Trump has thrown his support behind the industry. “A very shrewd move, as many of the young people who own cryptocurrencies are so passionate about its importance to the world that they are single-issue voters,” said investment firm Pantera Capital.

For the investment company, this position by Trump is likely to attract young people who had not previously considered voting for him. He maintains that this led the government, led by the Democratic Party, to change its position, leading to advances in the industry. 

Adding to the authorization of bitcoin  ETF in the country this year, those of ether (ETH), Ethereum's cryptocurrency, were approved last month, despite their low expectations graphed below. Additionally, the FIT21 bill, which establishes a regulatory framework for digital assets, gained bipartisan approval . “I don't remember having seen such a deep-rooted policy change so quickly,” Pantera Capital said.

“The long line of digital assets can benefit greatly from this,” the company emphasized. According to his view, the authorization of Ethereum ETFs , together with the approval of FIT21 and the changing sentiment of the political and regulatory landscape of cryptocurrencies, will mainly have 5 impacts on the market .

The regulatory situation enables more cryptocurrency users and technological advances

The first impact is the growth and diversification of the market . “While the introduction of a bitcoin ETF was significant, especially as it relates to the use case of cryptocurrencies as a store of value, the existence of an Ethereum ETF may have strong implications for the broader spectrum of tokens.” , noted Pantera Capital.

Unlike Bitcoin, which was created to develop a decentralized currency with limited issuance, Ethereum is a network that allows the creation of multiple tokens and applications. Therefore, according to the investing company, the attention of the latter may spread among investors as they explore it as a technological platform.

That is why there are expectations that the launch of these instruments will lead to bullish momentum for altcoin prices . At the moment, the date of this event is not defined, but according to the president of the SEC, Gary Gensler, it will be sometime between this month and September.

The second impact has to do with the technological advances that it can promote. “If FIT21 is approved in the Senate and/or clear frameworks are established for symbolic projects to adhere to, this can accelerate the pace of innovation,” he warns.

As a third effect, Pantera Capital points out that bitcoin ETFs, along with the upcoming Ethereum ones, are available along with the rest of the securities on the market. This strengthens the idea that cryptoassets are seen as another asset class in traditional financial markets .

The fourth is that, as CriptoNoticias already reported, it opens the door for ETFs of more cryptocurrencies to be allowed . To know what will be next, the investment company advises monitoring BlackRock's next move. This company, which is the largest asset manager in the world, has the record for approved requested funds, a streak it maintained when it became involved in the cryptoasset market.

Finally, the fifth impact is that tokens will gain use as a form of capital. “Creating a regulatory framework whereby these tokens can begin to reflect the fundamental value creation of the underlying protocol, with novel ways of sharing those cash flows with token holders who contribute to the protocol, is a critical step towards achieving that future,” commented Pantera Capital.

In this way, the approval of the Ethereum ETFs and FIT21 represent a significant change in the regulatory and political landscape in the economic power. For Pantera Capital, “it offers a promising start” to this transformation.

“They could bring a new era of innovation in cryptocurrencies, attract a broader base of investors and users, and ensure that the United States industry does not fall behind the rest of the world,” he concludes.