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Over the years, the cryptocurrency industry has made many lofty promises, but any meaningful application for the technology—besides for scams and crimes—has largely failed to materialize. Still, the technology is closer than ever to its mainstream moment: Crypto-aligned PACs funneled a staggering sum into House and Senate races to elect candidates the industry deemed pro-crypto, and President-Elect Donald Trump has championed the industry. Crypto, whose death is often prophesied, will live to see another day.
Much of the news about crypto in the past few years has been a mix of market crashes and CEOs going to prison. But the political events of recent weeks are offering crypto new hope: The industry, which poured at least $245 million into this election cycle (accounting for nearly half of all corporate donations to federal elections by August), will now have hundreds of sympathetic officials in office. Although crypto PACs seem to have stayed out of the presidential race, the industry is already reportedly lobbying Trump and his allies hard for favorable regulations, and is likely to enjoy broader influence in the Washington of Trump. He once denounced bitcoin as a “scam,” yet during his latest campaign, he began to embrace crypto, rolling out a crypto platform this fall and likening the technology, for some reason, to “the steel industry of a hundred years ago.”
The crypto world is using this new leverage to ask for what it wants, which is chiefly to see Gary Gensler, the Securities and Exchange Commission chair who has tried to crack down on the industry, fired (Trump promised to do as much during his campaign). It’s also working to defang other harsh enforcement efforts: As my colleague Christopher Beam wrote last month, crypto leaders are being strategic, asking for certain regulations that are still favorable to their companies’ growth. “The industry’s message now: Make crypto normal. Regulate us, please. All we want is to know the rules of the road,” he wrote.
Despite support from Trump and, to a less visible extent, Vice President–Elect J. D. Vance (who has disclosed owning bitcoin and backed the industry over the years), this is not entirely a partisan issue. Kamala Harris gingerly talked about encouraging the technology during her campaign, and crypto PACs backed candidates across the spectrum who had expressed support for (or at least no hostility toward) crypto. Denouncing the technology, if industry leaders get their way, may become politically perilous.
The price of bitcoin hit an all-time high of more than $93,000 yesterday. And crypto PACs are looking to the future: One such group said it has already raised more than $78 million for the 2026 cycle. The industry is aiming to portray itself as trustworthy and eager to contribute to society, claiming that bad actors such as Sam Bankman-Fried have been flushed out and crypto is ready to move on. Still, “the idea that the slate can simply be wiped clean is not realistic,” Yesha Yadav, an expert on financial regulation at Vanderbilt Law School, told me in an email. Despite the optimism of the market and of many crypto leaders, she noted, “painful memories and hard losses” for consumers “can take time to fade.”
That reputational work would be key. At this point, the industry really wants “normalization,” Christopher told me. “Your too-online cousin already invests in crypto; now they want your grandma.” Part of this quest for normalization includes lobbying Congress to pass legislation classifying crypto tokens as commodities rather than securities—the former come with fewer disclosure requirements (and are overseen by a more lax regulatory agency). He added that the “the holy grail” for the industry would be getting pension funds, which control trillions of dollars, to invest in the famously erratic crypto market.
With that “normalization” comes risks to consumers. People have been burned by investing in crypto before, and they may be burned again. As the industry enters the mainstream—getting regulated in a more predictable (though perhaps also looser) way, and getting folded into other more traditional financial products—the extreme volatility, whereby coin values can lose massive amounts of value overnight, will remain. Soon, Christopher said, we may see the emergence of a crypto market akin to the world of online gambling: “high-risk, frequently exploitative, and accessible to just about anyone.” And “without an aggressive SEC,” he added, “it’s hard to see what stands between the industry and its wildest dreams.”
As my colleague Gilad Edelman wrote this year, the “utter pointlessness” and “lack of consensus about crypto’s purpose” may ironically have helped it shape-shift through so many near-death moments. Long searching for a raison d’être, it seems that crypto is coalescing around a new purpose: using its own money to get the government to help the industry survive.
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P.S.
The Sam Bankman-Fried story is coming soon(ish) to a movie theater near you. Lena Dunham is reportedly at work on an adaptation of the Michael Lewis book Going Infinite, to be developed and produced by A24 and Apple Studios. The Lewis book published the day the trial began; I will be curious to see how Dunham and her team square the tone of the book, which portrayed its subject fondly, with what happened next.
— Lora
Stephanie Bai contributed to this newsletter.
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