Why the crypto world wants Trump to win

Although Trump's views on cryptocurrencies are very clear, Harris's stance is not as clear. One of the heads of the US's top financial regulators told the BBC that the cryptocurrency industry is "full of fraud, hucksters, and scammers." Gary Gensler, the chair of the US Securities and Exchange Commission (SEC), said "investors have lost too much money when crypto companies haven't complied with time-tested securities laws that we've tried to enforce." This statement was made as the industry has spent millions of dollars on political donations in an attempt to influence the outcome of the US election in November, in the hope of getting more favorable laws. In addition to the presidential race between Donald Trump and Kamala Harris, all 435 House seats will be up for re-election, and 33 of the 100 Senate seats will also be contested. Cryptocurrency's future is one of the most hotly debated technologies globally, and this issue appears to have a clear divide between Donald Trump and the outgoing Biden administration. Trump has promised to make America the "global crypto capital" and create a "national strategic bitcoin reserve" similar to the US government's gold reserve, in a bid to win over crypto enthusiasts. Last week, he launched a new crypto company called World Liberty Financial, though he provided few details, saying "I think crypto is one of the things we have to do." This is a stark reversal from three years ago when he viewed bitcoin as "looking like a scam" and a threat to the dollar. Trump's new enthusiasm contrasts sharply with the Biden administration, of which Harris is the vice president. The White House has launched a crackdown on crypto companies in recent years. In March, FTX founder and CEO Sam Bankman-Fried was sentenced to 25 years in prison for fraud, having stolen billions of dollars from global customers, many of whom are still struggling to recover their money. Then in April, Binance founder CZ was sentenced to four months in prison, and the company paid a $4.3 billion ($3.2 billion) fine. He admitted to allowing criminals, child abusers, and terrorists to register and launder money on his platform, in a case brought by the US Department of Justice. The SEC has also sued Binance. Last year, financial regulators took a record 46 enforcement actions against companies trying to profit from this emerging technology. The imprisonment of crypto boss Sam Bankman-Fried reflects the worst of the crypto industry. "This is a field that has grown up, and just because they're recording their crypto assets on a new accounting ledger, they [wrongly] say 'we think we don't have to comply with time-tested laws,'" Gensler said. He explained that since the SEC's inception, there have been rules requiring companies seeking to raise money from the public to "share certain information" with them, rules designed to protect investors. This can be traced back to 1934, following the notorious 1929 Wall Street stock market crash that marked the start of the Great Depression. "Crypto is a small part of the US and global capital markets, but it could undermine the public's trust in capital markets," Gensler said. While supporters argue that cryptocurrencies provide a fast, cheap, and secure way to transfer funds, a US Federal Reserve survey found the number of Americans using crypto fell from 12% in 2021 to 7% last year. Harris has not spoken much about cryptocurrencies, but one of her advisers said last month that she will "support policies that ensure emerging technologies and the industry can continue to develop." Her team's recent meetings with industry executives aimed to build trust, while giving crypto bosses hope for a brighter future, regardless of who wins in November. "I cannot overstate the importance of this, not just for America, but for the world," said Paul Grewal, chief legal officer of crypto company Coinbase, who attended these meetings. "Not only is the US a critical market for crypto, but the critical technology around crypto is developing here. I think we have to recognize that the rest of the world is not just sitting idly by waiting for the US to sort itself out." He added that given the fierce competition in the White House race, "every vote will count, and the crypto vote will be no exception." The SEC chair, Gary Gensler, has been highly critical of some crypto companies. The crackdown on cryptocurrencies in the US this year has also reverberated in Europe. In April, the EU reached a new law aimed at reducing the risk of cryptocurrencies being used by criminals. However, the pace of action by other regulators has been slower. The G20 is developing minimum standards for cryptocurrencies, but these are not legally binding and progress has been slow. In the US, a bill to regulate cryptocurrencies has passed the House but not the Senate. Critics argue this will reduce consumer protections. Coinbase's Grewal supports the bill, saying "this industry is not shying away from regulation." He added that the industry just wants the same standards applied to crypto as other assets, "not more stringent, but not more lenient either." As the November US elections approach, the crypto industry senses an opportunity, hoping to elect lawmakers sympathetic to the industry. By last month, the industry had spent a record $119 million on donations, according to research by the non-profit Public Citizen. Rick Claypool, the research director at the consumer advocacy group, said this money was used "to help elect candidates who support crypto and attack crypto's critics, regardless of political affiliation." He added that their spending on corporate donations exceeded any other industry, as they try to make the US Congress cave to their demands for less regulation and weaken consumer protections.