The outcome of the U.S. presidential election and its implications for the crypto industry got more uncertain this week after Vice President Kamala Harris entered the race following President Joe Biden’s exit. Last month, former President Donald Trump swiftly changed his tune on bitcoin and embraced the community as a voting bloc — agreeing to appear at one of the industry’s largest conference in Nashville this weekend and adding adding it as a priority in his Republican Party Platform . Many are now wondering what a Harris administration could mean for crypto – especially following years of an anti-crypto crusade led by Biden-appointed SEC Chair Gary Gensler and Sen. Elizabeth Warren, D-Mass. The outlook on that front is unclear right now. Harris doesn’t have a public stance on crypto. Who she would appoint to cabinet positions is also unknown. What’s clear, though, is that the Democrats now have an opportunity to win back some of the crypto vote they’ve lost in recent years. “It provides a fresh opportunity to have a new conversation with Democratic leadership … [and] for the Democratic Party to do something positive about the industry – maybe include something in their platform and start to make some of the changes that we missed over the past couple years, that policy changes that the industry needs,” said Kristin Smith, CEO of the Blockchain Association, a policy-focused advocacy group. JMP Securities analyst Devin Ryan added that “there can be a moving of the pendulum back to the middle, and we’re seeing it real time.” On Tuesday, a day after Harris launched her campaign, billionaire Mark Cuban said her advisors had begun reaching out to him about crypto policy . Bitcoin, the largest cryptocurrency, had recently seen a boost as Trump incorporated crypto into his platform. The price of bitcoin rose about 12% in the week after Trump began accepting donations in bitcoin. BTC.CM= mountain 2024-05-01 BTC since May The market, however, doesn’t yet have a response to Harris’ campaign. JMP’s Ryan noted this uncertainty could inject volatility into markets, “but with a positive bias.” “This is the first election where this has really become a prominent voting issue,” he said. “All the data points are suggesting a coalescing bipartisan view, and that’s probably going to become the more relevant underpinning here for the market.” In recent years, Democratic lawmakers have been seen as less friendly toward crypto — thanks largely to Warren’s openly anti-crypto stance and Gensler’s seeming attempts to hold the industry back — than Republicans. That’s changing quickly , however. The crypto industry sees itself as nonpartisan, and in recent weeks has bipartisan support for crypto in Congress has been growing. “There have been some positive actions from the Democratic Party in recent months, including the support of SAB 121 repeal,” Ryan said. SAB 121 is a controversial SEC accounting policy that forced banks to treat digital assets on their books as liabilities. The House voted on May 8 to overturn it. “That is repairing some of the damage,” Ryan said. “It’s a degree of receptivity and embracing.” Around the same time, the House passed a crypto infrastructure bill called FIT 21 (the Financial Innovation and Technology for the 21st Century Act ), which would specify when crypto falls under the purview of the SEC versus the Commodity Futures Trading Commission. Many are hailing that, and specifically the bipartisan support, as a landmark victory for the industry. “We have a lot of Democrats in the House and Senate who are very supportive of the industry – particularly in California,” Smith said. “A lot of the votes that we saw in the FIT 21 bill in the House included people like Nancy Pelosi and Adam Schiff, who are senior members of the California delegation.” “Given where [Harris] comes from and the fact that she’s younger, it’s a real opportunity to reset the narrative,” she added. “Certainly, if she were elected, she would probably want to put her own people in charge at the SEC and at other federal agencies. Whether or not that plays out, sort of remains to be seen.”
