The cryptocurrency industry, a growing force in the 2024 election cycle, expects a more favorable regulatory environment regardless of who wins the presidency.
The 2024 US presidential election is poised to shape the future of cryptocurrency. A victory for Vice President Kamala Harris crypto community Divided: Some investors fear his ties to Biden’s apparently anti-crypto administration will hurt the market, while others believe his leadership could spur growth through favorable policies. While the industry has clashed with the Biden administration over regulatory issues, executives and experts believe a potential Harris administration and a second Trump term would offer a softer approach to crypto regulation.
A change of democratic position?
Despite the Biden administration’s tougher stance, Vice President Kamala Harris has signaled a potential shift in the Democratic Party’s approach. At a fundraising event, Harris expressed his intention to “encourage innovative technologies like AI and digital assets.” This marks a departure from the approach of the current administration, which has been characterized by regulatory crackdowns, including from the Securities and Exchange Commission (SEC) chaired by Gary Gensler.
The SEC’s approach under Biden, led by Chairman Gary Gensler, has been characterized as restrictive, sparking speculation about its possible replacement under a new administration. Mark Cuban and other industry figures believe Harris could bring clarity to regulations, making the United States a more stable environment for crypto. Draper further advocates updating outdated U.S. securities laws, arguing that applying old frameworks to modern digital assets is counterproductive.
While the United States remains attractive due to its massive economy, crypto companies face regulatory pressures, leading some to consider moving their operations overseas. The election outcome could usher in new leadership at the SEC and change regulatory dynamics, with the potential to either solidify the United States as a crypto hub or accelerate migration to more welcoming markets.
Although Harris did not detail specific crypto policies, his comments were welcomed by some in the industry. Billionaire entrepreneur Mark Cuban, a Harris surrogate and crypto enthusiast, expressed optimism about a Harris presidency: “It will absolutely more user-friendly under a Harris administrator,” he wrote, emphasizing the importance of Harris’ commitment to protecting crypto users.
Further evidence of potential change within the Democratic Party comes from the formation of groups like Crypto4Harris, which aims to support Harris’ campaign while advocating for a “complete reset of crypto and blockchain policy,” according to Jonathan Padilla, CEO of blockchain company Snickerdoodle Labs.
Harris will advocate for regulations that ensure “black men who invest and own these assets are protected.” 
Source: kamalaharris.com
Trump’s “crypto president” speech
On the Republican side, Donald Trump has actively courted crypto industry, declaring its intention to make the United States the “crypto capital of the planet.” Trump has criticized the current administration’s approach to crypto regulation and has proposed a series of crypto-friendly policies, including the creation of a government stockpile of Bitcoin and a crypto advisory council.
He also pledged to prevent the Federal Reserve from creating its own digital currency, a move opposed by many in the crypto community.
Congressional influence
Beyond the presidential race, the crypto industry is also making its presence felt in the congressional elections. Crypto companies and wealthy investors invested more than $119 million to influence the federal election, according to a Public Citizen report. This includes significant spending on campaign advertisements, with crypto groups spending significantly more to support Republican candidates than Democrats.
While Fairshake, a major crypto PAC, has supported candidates from both parties, its affiliated super PACs have steered significantly more ad spending toward Republicans, according to AdImpact data. This indicates a strategic investment in the Republican Party, even though the industry has ties to both sides of the party.
Kristin Smith, CEO of the Blockchain Association, suggested that a Republican-controlled Senate would be beneficial for the industry, saying: “I think a slightly Republican Senate would be a good thing because it neutralizes the influence of ‘Elizabeth Warren. » Warren, a vocal critic of the crypto industry, is seen as a significant obstacle to the industry’s legislative goals.
Looking to the future
Regardless of the election outcome, several factors point to a potential shift in the crypto regulatory landscape. The industry is expecting a review or even reversal of the SEC’s “SAB 121” guidance, which requires public companies to account for crypto assets held on behalf of others as liabilities. This guidance is a major concern for the industry, hindering broader adoption by financial institutions.
Congress’s bipartisan vote to overturn SAB 121, Although President Biden vetoed it, this suggests growing support for more favorable accounting treatment of crypto assets. Recent actions by the SEC, including allowing BNY Mellon to hold cryptocurrencies without accounting for them as a liability, further indicate a possible softening of the agency’s stance.
These developments, coupled with the growing political engagement and financial influence of the crypto industry, suggest that regardless of who occupies the White House or controls Congress, the cryptocurrency industry will likely find itself in an environment more welcoming regulations in the years to come. Crypto’s growing mainstreaming, coupled with the industry’s aggressive lobbying efforts, has positioned it for potential gains regardless of election results.
