Under the ballot, I aspire to become the "Crypto President".
By Chandler, Foresight News
Cover: Photo by Donovan Reeves on Unsplash
On July 22, 2024, the current US President Biden announced that he would withdraw from the 2024 US presidential election and would not seek re-election. He planned to complete the remaining term, which will end on January 20, 2025. He published an open letter on the social platform, saying, "It is the greatest honor of my life to serve as your president. Although I have always intended to run for re-election, I believe that it is in the best interests of our party and country for me to withdraw and concentrate on fulfilling my duties as president for the rest of my term. Today, I give my full support and approval to Vice President Kamala Harris as the nominee this year."
In the past few years that Biden has been in office, the U.S. government has mainly tended to be cautious in regulating the crypto industry, focusing on the improvement of regulations. Of course, this is inseparable from the last round of bear market and the serial liquidations caused by the collapse of FTX. In March 2022, Biden signed an executive order on ensuring responsible innovation in digital assets, outlining the U.S. government's cryptocurrency strategy, directing federal agencies to review potential regulatory changes, and released a comprehensive digital asset development framework in September 2022. In March 2023, the U.S. "2023 Presidential Economic Report" concluded that crypto assets "are too risky to be used as a payment tool or to expand financial inclusion" and that "the assets appear to be here to stay, and they will continue to pose risks to financial markets, investors, and consumers." Subsequently, the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) launched severe enforcement actions against crypto entities such as Binance, Kraken, and Coinbase.
In 2024, the approval of the Bitcoin spot ETF gave the market hope for policy easing. But in May, the Biden administration chose to veto the resolution to overturn the SEC's crypto asset accounting standard SAB 121, which prevented heavily regulated U.S. banks from custodial digital assets on a large scale, sparking strong opposition from crypto supporters. At the time, U.S. Senator Cynthia Lummis, who supported the cryptocurrency industry, said, "U.S. President Joe Biden decided to veto the repeal of controversial cryptocurrency accounting standards and missed the opportunity to correct his position on crypto assets. I will not stand idly by and will continue to work hard to promote financial innovation."
As the election draws near, the Biden administration intends to ease this regulatory attitude, including approving the listing of Ethereum spot ETFs, but it has not received support from many voters in the crypto field. On the other hand, Trump is waving the banner of "Crypto President" and constantly showing his support for the crypto field to cater to voters.
From crypto naysayers to critics of Biden's crypto policy
In fact, in the early years, Trump was firmly opposed to crypto assets. In 2019, he also said on Twitter: "I am not a fan of Bitcoin and other cryptocurrencies. They are not currencies, and their value is highly volatile and based on air. Unregulated crypto assets can facilitate illegal behavior, including drug trafficking and other illegal activities..." At the same time, in 2021, he said in an interview with Fox Business Channel that Bitcoin is a scam against the US dollar, and he would not be surprised if it fell below $6,000.
However, since the beginning of this election, Trump has gradually confirmed his inclined attitude towards the crypto community, and together with the Republicans, he has repeatedly criticized the Biden administration's tough stance.
Trump once criticized Biden for not understanding cryptocurrency at all, and posted on his social media platform Truth Social, "I am very positive and open to cryptocurrency companies and things related to this emerging industry. The United States must be a leader in this field, not second. On the other hand, Joe Biden, the worst president in American history, hopes that the industry will die slowly and painfully. This will never happen to me!"
At the Libertarian National Convention, Trump promised that if he was re-elected as president, he would commute the sentence and release Ross Ulbricht, the creator of the Silk Road. "If you vote for me, on my first day in office I will convert Ross Ulbricht's sentence to a limited term. He has served 11 years, and we will send him home." In addition, he said he would ensure that the future of cryptocurrency and Bitcoin happens in the United States, not overseas; support the self-custody power of 50 million cryptocurrency holders in the United States, and will firmly oppose the creation of a central bank digital currency, which has always been one of the important policies advocated by the Democratic Party; stop Biden's actions to destroy cryptocurrency; and keep cryptocurrency opponent Elizabeth Warren away from Bitcoin.
In June, Trump met with several Bitcoin mining representatives at Mar-a-Lago. Matthew Schultz, executive chairman of Bitcoin mining company CleanSpark Inc., said Trump loved and understood cryptocurrencies, adding that Bitcoin mining companies help stabilize the energy supply of the power grid and emphasized that he would speak for miners in the White House. This so-called "Presidential Roundtable on Bitcoin Mining" was attended by participants in addition to Nasdaq-listed Bitcoin mining companies CleanSpark and Riot Platforms, as well as Marathon Digital and other well-known industry players. Key figures include S Matthew Schultz of CleanSpark, Jason Les and Brian Morgenstern of Riot Platforms, Salman Khan, CFO of Marathon Digital, and Amanda Fabiano of Fabiano Consulting (former Galaxy mining executive and former director of Fidelity).
This move actually targets Biden's attitude towards crypto mining. The 2025 fiscal year budget proposed by the Biden administration points out that crypto mining activities have a negative impact on the environment, will affect environmental justice, and will raise the energy prices paid by those who share the power grid with cryptocurrency miners. Therefore, the budget proposes a 30% tax on the total energy costs of cryptocurrency miners, applicable to the power supplied by the grid and the power generated by the miners themselves. The plan will be implemented in stages, with a 10% tax from 2025, a 20% tax from 2026, and finally a 30% tax from 2027. Biden proposed the same tax plan last year, but it failed to pass the House of Representatives and the Senate to become law.
Appealing to crypto voters from multiple angles
In order to win more votes and financial support from the crypto space, the Trump campaign also announced that it would begin accepting cryptocurrency donations, saying the move was to unite those who "oppose the Biden administration's control of the U.S. financial market." According to the Wall Street Journal, the Trump campaign raised a total of $331 million in the second quarter, with cryptocurrency donations accounting for about 1%, most of which were Bitcoin and Ethereum, worth about $3 million. Between May and the end of June, about 100 people donated cryptocurrencies to Trump's campaign.
Data shows that crypto industry donors have donated $94 million to U.S. federal political committees since 2023, exceeding the $83 million donated in the previous election cycle, and most of the donations came from the Political Action Committee (PAC), the main channel for Trump's fundraising. Among them, Coinbase and Ripple Labs donated $20.5 million and $20 million respectively. In addition, Marc Andreessen and Ben Horowitz each donated $9 million to Fairshake, billionaire twins Cameron and Tyler Winklevoss each donated $2.5 million; Coinbase Global CEO Brian Armstrong donated $1 million.
In addition to accepting campaign donations, Trump also plans to attend the Bitcoin 2024 conference in Nashville at the end of July to give a speech. According to CryptoSlate, sources revealed that Trump may make a landmark statement at the conference, planning to use Bitcoin as a strategic reserve asset for the United States.
In terms of specific policy support, the Republican Party expressed support for a number of favorable crypto policy measures in its official party platform for the 2024 US election, vowing to end the "illegal and un-American crackdown" on the US crypto industry. In addition to opposing the creation of CBDC, the platform also promises to "defend the right to mine Bitcoin" and allow crypto holders to keep their tokens themselves, saying "we will defend the right to trade without government supervision and control."
At the same time, Trump also appointed Ohio Senator JD Vance as the Republican vice presidential candidate. Vance, a former venture capitalist, has publicly supported cryptocurrencies many times and criticized the SEC's regulatory model. Last month, he also drafted a draft bill on reforming the way digital assets are regulated. He disclosed in his annual report submitted last year that as of 2022, he held between $100,000 and $250,000 worth of Bitcoin through Coinbase.
According to Coinbase CEO Brian Armstrong, he has met with more than 10 Democratic and Republican senators in Washington, DC, to discuss the establishment of clear rules for the crypto industry and consumer protection for crypto users. In addition, he said that since the Financial Innovation and Technology Act of the 21st Century (FIT21) has been passed by the House of Representatives, both parties in the Senate have "strong motivation" to complete this work. "It's great to see that the voices of cryptocurrency voters have an impact."
Overall, Trump's pro-crypto stance is having a profound impact on the development of the crypto market and the US election. However, this supportive stance is also complex. In the context of the US election, Trump's pro-crypto stance may attract the support of some crypto enthusiasts and technology industry practitioners. But at the same time, considering his changing stance on cryptocurrency, there is still uncertainty about his policy stability and execution, which may cause market volatility and regulatory uncertainty.
In any case, his stance has undoubtedly effectively boosted his support rate. According to data compiled by polling firm Echelon Insights, 13% of those who do not plan to vote for Trump believe that his cryptocurrency status gives them a more positive view of him. The poll showed that most respondents (60%) believe that Congress needs to enact regulations for cryptocurrency businesses, and Republicans generally do not like the way the current financial system works. And for the development of the encryption field, perhaps this is also a blessing. As the agency 10x Research said, there seems to be no strong candidate who can challenge Trump. For Bitcoin, this means that a government that supports cryptocurrency will move into the White House. Historical experience shows that when a new government comes to power, the chairman of the SEC usually resigns. Although the current chairman of the US SEC, Gary Gensler, will last until June 5, 2026, he is likely to resign in January or February 2025.
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