As a seasoned analyst with over two decades of experience observing U.S. politics and its impact on various industries, I find myself captivated by this year’s election cycle, particularly as it pertains to cryptocurrency and blockchain policies. The outcome will undoubtedly shape the future landscape of digital assets for years to come.
In the final round of voting during the 2024 election season, American voters are making their way to cast their ballots, choosing who will represent them in the House of Representatives, the Senate, and the White House.
In the upcoming elections, the balance of power in Congress and the presidency could shift significantly between Democrats and Republicans. This could have long-term implications on the regulations governing cryptocurrencies and blockchain technology, as different parties might favor varying policies.
Despite having a narrow lead in the House from 2023, the Congress was historically one of the least productive in U.S. history. Yet, amidst this productivity drought, lawmakers managed to pass significant bills such as the Financial Innovation and Technology for the 21st Century Act (FIT21), the CBDC Anti-Surveillance State Act, and the Financial Technology Protection Act of 2023.
It’s been proposed by certain legislators that certain bills might be approved in the Senate before the U.S. election and prior to the start of the next Congress session in January 2025. However, some may encounter a fresh Congress with newly elected lawmakers, potentially under new leadership.
Among the numerous concerns surrounding cryptocurrencies in the upcoming election are the selection of the SEC’s new leader, currently headed by Gary Gensler; the question of whether elected officials can invest in digital assets; and how federal authorities handle crypto-related crimes. It’s important to note that while the presidential race is significant, it only represents one piece of the puzzle when it comes to shaping cryptocurrency legislation.
The Senate
Currently, Democrats hold a slim majority in the Senate with a 51 to 49 advantage, but elections for 34 seats will take place on November 5th. The party that holds the most seats in the Senate has the power to determine committee leadership and set the legislative agenda. For example, if they have control, they can decide whether hearings focus on misuses of digital assets or the advantages of this technology.
One of the biggest races for crypto advocates could be the Ohio Senate election between Democrat Sherrod Brown and Republican Bernie Moreno. Senator Brown serves as Chair of the Senate Banking Committee and has been one of Congress’s most vocal crypto skeptics. Early November polls showed the race as essentially a toss-up.
In the state of Texas, home to numerous Bitcoin mining operations, Democratic Representative Colin Allred is challenging incumbent Senator Ted Cruz. Supporters within the cryptocurrency industry, such as the Texas Blockchain Council, have previously backed Cruz due to his strong and unwavering support for digital currencies.
Additionally, Allred has supported FIT21 and encouraged his Democratic peers to take a progressive stance towards digital currencies and blockchain innovation. Surveys generally indicated that Cruz was slightly ahead of Allred in the polls.
In other tight Senate races, such as that between Jon Tester and Tim Sheehy in Montana, could potentially shift the Senate towards the Republicans. However, various scenarios might prove advantageous for the industry. Massachusetts Senator Elizabeth Warren appears likely to retain her seat amidst a challenge by Republican candidate and XRP attorney John Deaton, according to most surveys.
If Moreno manages to win against Senator Brown, the Democrats might gain a seat in Texas, necessitating a new party committee chair. Conversely, if the Republicans secure one additional Senate seat and hold onto the presidency, their prospective Vice President, JD Vance, would serve as a tiebreaker in the chamber.
As an analyst, I expressed in September to CryptoMoon that if the Senate Republican majority arises, it could stimulate further legislative advancements for the crypto industry. This is particularly significant following Senator Tim Scott’s declaration of creating a cryptocurrency subcommittee should the Republicans emerge victorious.
In the event that Kamala Harris becomes President and Democrats lose a single Senate seat, they would still maintain control of the Senate due to Harris’ ability to act as the tiebreaker vote. This was stated by Democratic Senator and Majority Leader Chuck Schumer in August. One objective he expressed at that time was to pass bipartisan cryptocurrency legislation before 2025, hinting that a Harris administration may take a similar position on this issue.
The House of Representatives
2024 Congressional contenders are receiving substantial financial backing from cryptocurrency interest groups, channeled into ads that boost legislators advocating pro-cryptocurrency policies while criticizing those who don’t. While political action committees (PACs) have invested millions in Senate elections where a candidate backs cryptocurrencies, it is crucial not to underestimate the significance of House races in this context.
On November 5th, when polls are closed, millions of American voters will have chosen their representatives for 435 congressional districts across the country. Similar to the Senate, the House holds the power to advance legislation concerning the crypto industry and exercise supervision over regulatory entities such as the Securities and Exchange Commission (SEC).
With a Republican majority in place, Representative Patrick McHenry presided over the House Financial Services Committee, while Democratic representative Maxine Waters served as the minority leader. Both parties were discussing the details of a stablecoin bill, but it remains uncertain how this legislation will progress in the upcoming Congress.
2023 saw Representative McHenry deciding not to seek reelection, opening up an opportunity for Representative French Hill, who heads a digital asset subcommittee, to potentially become committee chair in his stead. If Democrats manage to secure enough seats to regain control of the House, this role might revert back to Representative Waters.
Independent political committees, such as Fairshake, appear to be gearing up to back candidates who are pro-cryptocurrency ahead of the elections in 2026. This was made clear on November 4 when they announced that they had gathered $48 million in funds from Coinbase and Andreessen Horowitz for the upcoming midterm elections.
The Presidency
In 2024, Donald Trump pledged several actions to cryptocurrency users: he intends to dismiss Gensler, stand against the establishment of a digital currency by the central bank, pardon the founder of Silk Road, Ross Ulbricht, and advocate for all Bitcoin production to be domestic.
Vice President Harris, entering the presidential race just in July, hasn’t emphasized digital assets as a key focus in her campaign as extensively as Trump did, yet she has expressed that she would advocate for the sector should she be elected into office.
In a recent interview with Saxo, Anthony Scaramucci, Trump’s former White House communications director, warned that it’s crucial to be cautious if Trump supports cryptocurrency, as there may be many Democrats who are against it simply because Trump endorses it. He suggested that we should try to remove politics from regulatory decisions and focus more on what is right or wrong instead of left or right.
6 PM ET marks the closing time for the initial polls here in the U.S., and based on expert analysis, it’s anticipated that we might see the outcomes of some Senate races declared as early as November 6th. The presidential election results could follow by the end of the week, while the House results may not be far behind. As a crypto investor keeping an eye on these developments, I am eagerly waiting to see how these elections unfold and what impact they might have on our market.
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2024-11-05 21:22