Author: Bulu
As the U.S. presidential election day approaches, the crypto digital asset industry is also on edge - regarding the globally hotly debated issue of "crypto assets", it is not only a governing issue on which there are obvious differences between U.S. President-elect Trump and the outgoing Biden administration, but also a focal issue of continued controversy during this U.S. presidential election.
Two Views
As the last two candidates in this US presidential election, Trump has a very clear view on the crypto digital asset industry. In July 2024, he attended the Bitcoin conference in Nashville and expressed his support in a high-profile manner. In contrast, Harris, another presidential candidate, has a relatively vague attitude towards the digital asset industry, but her attitude is relatively calm compared to the current Biden administration.
During the campaign, Trump’s policy proposals on digital assets that had a greater impact on public opinion included:
- Establishing a national BTC reserve: Trump said that his administration will "retain all BTC currently held or acquired by the U.S. government in the future" and will form the "core of the national strategic BTC reserve." It is reported that as of October 2023, the U.S. government holds more than $5 billion in BTC, most of which comes from asset confiscations in criminal cases.
- Establish a Digital Asset Advisory Committee: Trump proposed the establishment of an organization called the "Presidential Advisory Committee on Bitcoin and Crypto Assets," whose rules would be written by people who love the industry, not those who hate it.
- Preventing the Fed from creating a central bank digital currency: It has become a trend for central banks in various countries to develop central bank digital currencies, but the Fed has not yet decided whether to create a fully digital dollar. Trump publicly opposed this idea many times in 2024. In May 2024, the U.S. House of Representatives passed a bill prohibiting the Federal Reserve from creating a digital dollar, but whether the bill can be finally passed by law still requires a long negotiation process.
- Create the crypto platform World Liberty Financial: Aims to promote the widespread use of Stablecoins and decentralized finance. According to public reports, the project's early white paper mentioned that it would launch a new digital asset called $WLFI, which it plans to sell to the public.
Although Trump was skeptical about crypto assets three years ago and criticized crypto assets on social platforms for facilitating illegal activities, since August 2024, he has repositioned himself as a presidential candidate who firmly supports crypto assets.
Harris previously served as Vice President of the United States in the current Biden administration. The current US government has adopted a strong and strict regulatory attitude towards the encrypted digital asset industry.
So far, Harris has not made many comments on the crypto digital asset industry. On September 22, 2024, at a fundraising event held in New York City, Harris first mentioned plans to "encourage innovative technologies such as artificial intelligence and digital assets."
At the same time, public media reports pointed out that Harris said at an event in Manhattan that she might take a more open stance on the crypto digital asset industry than the current government. However, Harris has not yet put forward a specific policy plan.
In addition, given the need to compete for potential voters, the Democratic leaders behind Harris are working to improve relations with the crypto digital asset industry. A digital asset advocacy group called Crypto4Harris held a virtual town hall meeting that brought together several Democratic members.
Crypto market action
According to data cited in public media reports, companies in the crypto digital asset industry, such as Coinbase and Ripple, have become the dominant corporate donors in the 2024 U.S. presidential election, with donations accounting for 48%, nearly half, of all corporate political donations in 2024.
According to OpenSecrets, a nonprofit that tracks campaign spending, the cryptocurrency industry has spent $119 million on political donations as of August 2024, exceeding the amount of political donations from all other industries.
In this U.S. presidential election, the cryptocurrency industry has already sensed an opportunity, hoping to use the election to select government officials who will support the cryptocurrency industry.
It is reported that in fact, since 2010, companies in the encrypted digital asset industry have been actively participating in political elections. The depth, breadth and scale of their participation are second only to fossil fuel companies, making it the second largest industry actively participating in US political elections.
The survey data published in the recent report Election 2024 The Role of Crypto by GraysCale, the issuer of Ethereum spot ETF, indirectly reflects some market conditions of the US digital asset industry:
- 53% of American voters surveyed said they knew something about crypto assets, an increase from the 2023 survey.
- Regulation still has an important role to play in bolstering investor confidence in crypto assets — 80% of U.S. voters surveyed believe regulators have a role to play in managing emerging technologies, and 20% of voters surveyed said they would be more likely to hold crypto assets if there were clearer digital asset regulations or policies.
- 40% of U.S. voters surveyed said they were more concerned about the presidential candidates’ stance on BTC or other crypto assets in this election than in previous elections.
- Two-thirds of U.S. voters surveyed said they would consider the presidential candidates’ positions on digital assets before voting, with 56% of voters surveyed saying they would be more likely to vote for a presidential candidate who is knowledgeable and educated about digital assets than one who is unconcerned.
Opposing voices
Polymarket, a social event prediction and betting website, shows that in early October 2024, Donald Trump and Kamala Harris's approval ratings were tied at nearly 50%, but from late October 2024, Trump's approval rating suddenly rose, reaching 65.5% as of October 31, 2024, and he became the focus of election discussions for a while.
Experts who study the election have publicly stated that this situation may come from the enthusiasm of a small number of speculators in the cryptocurrency industry who are trying to build momentum for Trump.
Although the influence of the cryptocurrency industry in political games seems to be increasing, opposition to cryptocurrency has never stopped in the United States.
In an interview with the media, Gary Gensler, chairman of the U.S. Securities and Exchange Commission, said that the crypto digital asset industry is "full of fraudsters and speculators." He pointed out: "Crypto assets are only a small part of the U.S. and global capital markets, but they may undermine the trust of ordinary investors in the capital markets... Global investors have lost too much money because companies in the crypto digital asset industry have not followed regulatory requirements."
Crypto-friendly today doesn’t mean crypto-friendly in 5 years
Driven by hundreds of millions of dollars in election funds, crypto digital assets have become an important factor in the 2024 US election, influencing not only presidential candidates but also a large number of voters.
Trump has attracted supporters of crypto assets through public and positive promises, while Harris and the Democratic Party are trying to follow suit and are unwilling to give up the strong electoral cash flow that can be obtained by supporting this industry. Supporters of the crypto asset field, on the other hand, are trying to exchange more favorable regulatory policies for the future development of the industry by supporting the election.
But amid the noise, the blog post written by Ethereum founder Vitalik Buterin is always worth revisiting. He expressed the following views on the relationship between crypto assets and politics:
If you see a politician being crypto-friendly, one thing you can do is look up what they thought about crypto itself 5 years ago.
You can also look up their opinions on crypto-related topics from 5 years ago. In particular, try to find topics where "supporting freedom" and "supporting companies" are inconsistent.
If a politician supports crypto assets, the key questions to ask are: Are they doing it for the right reasons? Do they share your vision for 21st century technology, politics, and economics? Do they have a positive vision beyond their immediate concerns of “beating down the other bad tribes”?
If they do, great: you should support them and make it clear that this is why you support them. If not, then either stay out of it completely or find a better power to ally with.
At the same time, Vitalik Buterin explicitly opposes the trend of choosing political allegiance based on who "supports crypto", and believes that this way of making decisions is highly risky and may go against your original intention and values in entering the crypto asset field.
As the US presidential election day on November 5, 2024 approaches, the battle between the two parties' presidential candidates is becoming more and more intense. As for the future of encrypted digital assets, as Vitalik Buterin has always expressed: the future of digital assets should be related to "decentralization", "encryption" is not just about digital assets and blockchain - we need to support not only "encryption", but also those deeper goals.
