Trump ushers in ‘new high water mark’ for deregulation

President Trump is following through on his pledge to usher in one of the most sweeping deregulatory drives in modern U.S. history, moving swiftly to slash environmental rules and bank oversight, remove barriers to cryptocurrencies, and reverse the Biden administration’s restrictions on energy production.

The most aggressive plans for a red-tape rollback have come from the Environmental Protection Agency, which in a single day announced 31 actions to deregulate U.S. environmental policies, including rules for power plants, the oil-and-gas industry, electric vehicles and wastewater.

Venture Global, a liquefied natural gas exporter, in early March announced an $18 billion investment in a Louisiana project, following the administration’s reversal of President Joe Biden’s freeze on approvals for LNG gas export plants, which has yielded plans for new projects and expansions. The Trump administration is “getting the red tape, getting the federal government off the back of the worker, off the back of companies,” Interior Secretary Doug Burgum said in an address to workers at the Louisiana facility.

Perhaps no sector is seeing an early boost of activity more than the crypto industry, where the Trump family is emerging as a bigger player. The number of crypto deals has surged since the election. In recent weeks, the Trump family held talks to invest in the U.S. arm of the crypto exchange Binance. Another crypto exchange, Kraken, struck a $1.5 billion deal for a U.S. retail futures trading platform.

Trump’s deregulatory moves are widespread: The Securities and Exchange Commission is backing away from Biden’s climate-related disclosure rules; the Federal Deposit Insurance Corp. rolled back a Biden-era policy that had stepped up scrutiny of large bank mergers; and the Interior and Housing and Urban Development departments are aiming to streamline regulations to spur the construction of housing on millions of acres of federal land.

Taken together, Trump’s moves are setting “the new high water mark in terms of the deregulatory agenda,” said Travis Fisher, who served in the first Trump administration and is now the director of energy and environmental policy studies at the Cato Institute, the libertarian think tank. He added that Trump is “moving more boldly than Ronald Reagan.”

Investors, bullish about Trump’s deregulatory agenda, sent stocks soaring after the election. Market participants expected “strong growth from the whole package of Trump policies, and when we talked to clients they’d often cite the deregulatory agenda,” said Julia Coronado, founder of MacroPolicy Perspectives, an economic-advisory firm that surveys investors.

In recent weeks, concern on Wall Street and in corporate boardrooms about the administration’s tariff policies has blunted high hopes for deregulation, economists said. The Federal Reserve’s latest projections point to the prospect that tariffs will send up prices while sapping investment, sentiment and growth. Trade uncertainty adds to other headwinds to cutting red tape, such as legal barriers and Trump’s downsizing of government.

“Tariffs can have a much quicker negative impact on the economy, whereas the deregulatory efforts take time to flow through the system,” said Mick Mulvaney, who served in the first Trump administration.

Trump has dubbed April 2—the expected date of his planned reciprocal tariffs—“Liberation Day,” marking the end of what he says is a global trade system that takes advantage of the U.S. He also said he would impose tariffs on all imported vehicles. The prospect of more tariffs, in addition to new ones he has already put on imports from China as well as steel and aluminum, has rattled markets in recent weeks.

CEOs who cheered Trump’s tax and regulatory cuts have grown increasingly pessimistic, though many remain reticent when it comes to speaking out in public because they fear retaliation from the administration, The Wall Street Journal has reported.

“The economic damage caused by the mounting global trade war will overwhelm any benefit from less regulation, certainly anytime in the foreseeable future,” said Mark Zandi, chief economist at Moody’s.

Administration officials have dismissed what they say is hand-wringing. Treasury Secretary Scott Bessent played down turbulence in the stock market in a recent interview on NBC News’s “Meet the Press.” “If we put good tax policy in place, deregulation and energy security, the markets will do great,” he said.

In addition to tariffs, Trump’s deregulatory push could meet other obstacles of the administration’s own making, experts said.

EPA Administrator Lee Zeldin, who lauded the agency’s actions earlier this month as “the greatest day of deregulation our nation has seen,” has also said the agency expects to slash its spending by 65%. That could pose a challenge to its ability to cut or rewrite dozens of complicated environmental regulations if the move results in reduced staff.

Changing rules at any agency is a lengthy process involving comment periods and potential lawsuits that can stretch out for years, said Walker Livingston, vice president of energy at Capstone, an advisory firm. “They’re going to run into logistical issues having to put out these rules” at the EPA, he said.

One barrier is the Administrative Procedure Act, a 1946 law that stipulates that federal agencies must provide notice before regulations are adopted or rescinded.

Elon Musk’s Department of Government Efficiency has helped advance Trump’s deregulatory agenda, but it has also invited legal challenges.

DOGE has moved to dismantle a regulatory agency, the Consumer Financial Protection Bureau, which policed large financial institutions. It has slashed spending and contracts across federal agencies and crafted orders leading to the ousting of tens of thousands of government employees, curbing agencies’ ability to enforce regulations. Many of those moves have been challenged in court.

Regarding crypto, the SEC has dismissed or halted roughly a dozen cases, investigations or appeals featuring crypto companies in recent weeks. Executives have cheered the administration’s moves, but some market watchers worry that opening up the sector with insufficient guardrails will lead to investor losses.

“You’re going to see people thinking, ‘Well, the SEC is not going to come after me,’” said Timothy Massad, former chairman of the Commodity Futures Trading Commission during the Obama administration and a research fellow at Harvard University’s Kennedy School.

Write to Scott Patterson at scott.patterson@wsj.com and Amrith Ramkumar at amrith.ramkumar@wsj.com