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The 2024 election could be the first in which cryptocurrency plays a decisive role and so far it is Donald Trump who is taking the lead.
Crypto might not be the top issue for Americans as they choose between former president Trump and Vice President Kamala Harris, but a quarter of voters in mostly swing states said they would consider candidates’ positions on it, according to a poll published in May by a digital currency company. A fifth of Americans own Bitcoin or another cryptocurrency, industry surveys show.
At stake for the crypto world in the election is industry regulation, with many players criticizing Securities and Exchange Commission (SEC) Chair Gary Gensler for an alleged lack of transparency and effectiveness and accusing President Joe Biden’s appointee of outright hostility to digital currencies.
Meanwhile, Trump’s Republican party has become the first major U.S. party to formally address crypto policy in its platform.
“Republicans will end Democrats’ unlawful and unAmerican Crypto crackdown and oppose the creation of a Central Bank Digital Currency,” the platform says. “We will defend the right to mine Bitcoin, and ensure every American has the right to self-custody of their Digital Assets, and transact free from Government Surveillance and Control.”
Gensler’s SEC did not respond to Newsweek‘s request for comment.
Harris’s Democrats have not set out a clear position on crypto.
Illustration by Newsweek/Getty Images
In 2021, Trump said Bitcoin “just seems like a scam”, but his change of heart was evident at a campaign rally in Racine, Wisconsin, in June where he said crypto’s future “will be made in America”. In July, he addressed the annual Bitcoin conference in Nashville, Tennessee.
More than $25 million from the crypto community had been donated to the Trump campaign until the end of July, he said in Nashville. The event on its own raised $25 million for his campaign, according to David Bailey, the conference organizer and CEO of Bitcoin Magazine. Harris had turned down an invitation to speak at the conference, David Bailey said prior to the event.
A person familiar with Trump campaign fundraising operations told Newsweek on August 12 that $7.9 million in crypto industry donations had been raised since May.
“Crypto innovators and others in the technology sector are under attack from Kamala Harris and the Democrats. While the Biden-Harris Administration stifles innovation with more regulation and higher taxes, President Trump is ready to encourage American leadership in this and other emerging technologies,” Brian Hughes, senior advisor in the Trump campaign, told Newsweek.
A Harris campaign spokesperson declined to comment to Newsweek about her policy stance on crypto.
But some Democrats and industry stalwarts believe she can still take advantage of crypto as an issue. While she has not spoken out to champion it, she has also not spoken out against it and hails from the tech industry’s epicenter in California.
On July 26, one day before Trump took the stage in Nashville, a group of 14 House Democrats including Representatives Wiley Nickel (North Carolina), Josh Gottheimer (New Jersey), Ro Khanna (California) and Ritchie Torres (New York), sent a letter to the Democratic National Committee and Harris urging “a forward-looking approach to digital assets and blockchain technology.”
Nickel, who was also present in Nashville, told Newsweek that Democrats “can’t hand this issue to Donald Trump.”
“Turning this issue into a political football is just exactly what Donald Trump is trying to do. It isn’t serving my constituents. It’s not serving anyone in the industry,” Nickel said.
“I think that’s an important point to make, and one that we’ve gotten a lot of traction with from Democrats as we talk about the tremendous use cases and great public policy reasons to embrace crypto as a party.”
“Democrats are now playing catch-up”
Eric Pulier, CEO of digital company Vatom, told Newsweek that Trump or Harris ignoring crypto would punish them politically.
“Democrats are now playing catch-up to try to make the case that in fact, they’re not hostile. They are also pro-innovation,” Pulier said.
Nickel was among only 71 House Democrats who supported crypto-based legislation known as Financial Innovation and Technology for the 21st Century Act (FIT21). The bill, which still requires Senate backing, was supported by 208 House Republicans. Just three Republicans voted against it.
Nickel has had behind-the-scenes conversations with the campaign, he said, but declined to share details.
A group called Crypto4Harris is hosting a virtual town hall August 14 that will include Mark Cuban among other venture capitalists. David Plouffe, a face from the Barack Obama administration who served on the advisory board of the crypto exchange Binance, is now advising the Harris campaign on crypto and other matters, according to Reuters and Politico.
Cuban told Decrypt that less than a week after Harris became the presumptive Democratic nominee, her campaign reached out to him about crypto. He called it “a good sign.”
A poll published in May by Digital Currency Group (DCG) and The Harris Poll found that some 26 percent of the 1,201 registered voters surveyed online across Michigan, Ohio, Montana, Pennsylvania, Nevada and Arizona said they are actively weighing political candidates’ positions on digital assets when determining their support.
“I think if you’d asked me a year ago if the crypto voter was a real thing, even I was skeptical,” Kristin Smith, CEO of the Blockchain Association, told Newsweek. “But I think what we’re finding is that people have a distrust or dissatisfaction with traditional finance or big tech companies, even though it might not be fully realized today.
“It explains why Trump has come out with such a strong crypto policy. It explains why we have so many Senate and House candidates that are thinking about (it). Harris’ campaign talking about wanting to reflect relations with the industry. I think this is really kind of a key moment.”
The nonprofit Stand With Crypto Alliance scores politicians based on their positions on crypto and endorses those it favors.
They have accumulated more than 1.32 million “advocates” since launching in August 2023 and could have a possibility of affecting key races. They have over 37,000 in Georgia, where Trump lost by fewer than 11,000 votes to Biden in 2020, and over 26,000 in Arizona, where Biden’s victory margin was below 12,000 votes.
The Alliance grades senators, giving 38 Republicans an “A” and five a “B”. Only six Democrats got “A” grades and one a “B”. Most of the rest got “D” or “F” grades for their opposition to crypto.
Kara Calvert, head of U.S. policy for crypto exchange Coinbase, said attention for the industry was becoming a game changer in politics.
“As we get closer and closer to the election, policymakers want to be reelected,” she told Newsweek.
There is little love lost between the industry and Gensler—an ex-Goldman Sachs partner who served in Hillary Clinton’s failed 2016 campaign.
The SEC has sued Coinbase multiple times, alleging it acted as an unregistered broker and exchange. In response, Coinbase has attempted to subpoena internal communications involving Gensler and the agency regarding motives surrounding regulatory measures. The SEC has also brought various cases against other crypto companies.
“The biggest challenge that we’ve had as an industry has been Gary Gensler at the SEC,” said Blockchain Association CEO Smith. “I think that getting him out of there and getting somebody in who’s willing to be constructive and have an open dialogue with the industry is probably the single best change that could happen.”
Democrat Representative Nickel also said Gensler should be replaced if Harris wins.
“His approach of regulation by enforcement has not served the Biden-Harris administration well at all. He’s actively hostile towards crypto, and that’s absolutely not helping keep those jobs here in America,” Nickel said.