The Crypto Sector's Political Ambitions: Backing the 2024 US Elections

The upcoming November elections are pivotal for the crypto sector. In addition to the presidential race between Trump and Kamala Harris

The crypto industry is making a last-ditch effort to influence the 2024 US elections, hoping for a Donald Trump victory that will fulfill his campaign’s promise of a pro-crypto agenda. This support comes as regulatory scrutiny continues under the Securities and Exchange Commission (SEC), led by Gary Gensler, who asserts that the sector is full of scams, alleging that crypto firms are violating established financial laws. Political donations from crypto players have surged in an attempt to shape laws in their favor.

The upcoming November elections are pivotal for the crypto sector. In addition to the presidential race between Trump and Kamala Harris, all 435 House seats and 33 Senate seats are contested. The industry believes that a win by Trump could yield policies that boost cryptocurrency innovation. Trump recently launched World Liberty Financial, a venture he claims will advance crypto in America. He also envisions a national bitcoin stockpile to mirror the gold reserves.

Trump’s current support for crypto marks a shift from his earlier skepticism. In 2021, he labeled Bitcoin (CRYPTO: BTC) a scam and a threat to the dollar. Now, he aims to make the US the “crypto capital of the planet.” In contrast, the Biden administration has enforced stricter regulations, which have led to several enforcement actions against major firms, including Binance and FTX.

On the other hand, Harris has not been very vocal about crypto, although her advisers have suggested that she supports growth-friendly policies for emerging technologies. However, her campaign appears to be more focused on regulatory oversight than Trump’s proposed innovations.

Meanwhile, Gensler and the SEC have increased their actions against non-compliant crypto firms, citing investor protection concerns. Last year, the SEC filed 46 enforcement actions in the crypto space. Binance founder Changpeng Zhao was recently convicted and fined billions, while FTX’s Sam Bankman-Fried received a 25-year sentence for fraud.

A recent Federal Reserve survey highlighted a decline in US crypto usage, dropping from 12% in 2021 to 7% in 2023. While some believe crypto offers fast, secure transactions, others consider it risky.

The SEC maintains that securities laws are in place to protect investors, requiring firms to share critical financial information. The commission views crypto as a potential threat to market integrity despite its smaller scale than traditional financial markets. As crypto advocates continue to push for reforms, the SEC remains firm on compliance.

The outcome of the 2024 elections could notably influence the future of the US crypto sector. With both candidates adopting contrasting stances, the results are set to impact the industry's regulatory landscape.

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