Trump Backs Crypto: Promises Deregulation as Industry Surges in Political Influence
October 31, 2024The crypto industry has invested over $130 million in political contributions to influence congressional races, shifting its messaging to advocate for clearer regulations.
In May 2024, the House of Representatives passed a bill that aligns with the demands of crypto lobbyists, while the Senate has rolled back previous SEC guidelines intended to protect consumers.
A significant debate is ongoing regarding the classification of cryptocurrencies as either securities or commodities, which would greatly affect their regulatory framework.
Donald Trump has emerged as a vocal supporter of cryptocurrency, promising to promote it as a key industry in the U.S. and aiming to eliminate SEC regulations that hinder its growth.
Both presidential candidates are showing interest in the crypto sector, which could lead to a boom in deregulation following the upcoming election.
The cryptocurrency market is currently experiencing a notable resurgence, nearing its all-time highs from 2021.
Despite ongoing controversies, the crypto market has demonstrated resilience, with a notable decline in predictions of its demise over the past year.
If cryptocurrencies are classified as commodities, they would be regulated by the Commodity Futures Trading Commission (CFTC), which offers a more favorable environment compared to the stricter SEC regulations.
The crypto industry promotes stablecoins and decentralized applications as legitimate use cases, while also engaging in speculative activities that resemble gambling.
Companies within the crypto space are now adopting a more conventional image, distancing themselves from controversial figures like Sam Bankman-Fried and advocating for regulations that would normalize their operations.
Kamala Harris has expressed a desire to foster innovation in the digital asset space, although her regulatory stance remains unclear.
Consumer advocates caution that exempting cryptocurrencies from securities laws could enable riskier practices and mislead investors regarding the safety of digital assets.
The crypto sector has become the largest political donor in the current election cycle, surpassing even the fossil-fuel industry.
Summary based on 1 source
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Source
The Atlantic • Oct 30, 2024
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