Key Points
- The crypto industry expects a more favorable regulatory environment post-election, regardless of the winning candidate.
- Donald Trump pledges to support crypto innovation, while Kamala Harris signals openness to digital asset development.
- Crypto firms like Bitwise and Ripple are preparing new products and legislative strategies in anticipation of regulatory changes.
- Biden previously vetoed bipartisan support to overturn SAB 121, though both parties may push for it again.
The cryptocurrency industry, which has often clashed with President Joe Biden’s administration over regulatory policies, anticipates a more favorable approach from Washington regardless of the outcome of the upcoming presidential election. With key candidates hinting at a shift in their stance, crypto executives are preparing new initiatives and strategies to align with the new regulatory landscape potentially.
Crypto companies such as Bitwise and Canary Capital are actively developing new financial products, while others, like Ripple, are planning renewed legislative advocacy. Rebecca Rettig, chief legal officer at Polygon Labs, expressed optimism about a new approach from either administration. Republican candidate Donald Trump has pledged to be a “crypto president,” promising to fire Securities and Exchange Commission (SEC) Chair Gary Gensler, known for his stringent regulatory stance. Democratic candidate Kamala Harris has signaled her support for digital asset innovation, although she hasn’t outlined specific crypto policies yet.
Harris has support from crypto-friendly figures like billionaire Mark Cuban, who criticized Gensler’s regulatory approach and voiced optimism about a friendlier stance toward crypto under a Harris administration. Gensler’s tenure, which ends in 2026, has been marked by numerous enforcement actions against major crypto firms, including Coinbase and Kraken, which he accused of violating securities laws. The crypto sector, however, argues that digital assets should be regulated as commodities rather than securities.
Regarding campaign contributions, pro-crypto groups have significantly backed candidates who support regulatory change. For instance, Ripple and Coinbase have donated over $119 million to pro-crypto congressional candidates. Meanwhile, Trump has garnered donations from crypto-supportive figures like Gemini founders Cameron and Tyler Winklevoss, while some Democrats have also expressed concerns that Gensler’s hardline stance could alienate voters.
The crypto industry is particularly hopeful for changes to the SEC’s “SAB 121” guidance, which mandates that public companies list crypto assets held on behalf of clients as liabilities. This rule has discouraged banks from engaging with cryptocurrencies, as they must hold cash reserves against these liabilities. Despite bipartisan support to overturn SAB 121, Biden vetoed the resolution earlier this year. Crypto leaders believe that new leadership could revisit and potentially overturn this rule, expanding mainstream adoption and institutional investment in digital assets.
Moreover, the SEC has recently approved bitcoin and ether ETFs, signaling potential regulatory easing. Bitwise and Canary Capital have also filed applications to create ETFs tracking Ripple’s XRP token, anticipating a more receptive regulatory climate shortly.
