Will Former President Donald Trump Be Crypto’s Knight in Shining Armor Against Biden’s Policies?

As the 2024 U.S. Presidential election closes in, the crypto community finds itself at a crossroads, and with the cryptocurrency market’s recent wild ride, the stakes are higher than ever. Many enthusiasts believe that only Donald Trump can safeguard the future of digital currencies from Joe Biden’s restrictive policies.

Biden’s Regulatory Pressure 

President Joe Biden’s administration has been no friend to the crypto industry. From the IRS’s rule treating crypto wallet developers as brokers to the increased scrutiny from agencies like the SEC (Securities and Exchange Commission), with many crypto businesses feeling the squeeze, the Biden administration’s stance has been clear and unwavering. 

Gary Gensler, the SEC Chairman, has been particularly aggressive, labeling numerous tokens as securities, which subjects them to stringent regulations. 

This has led to a significant drop in market sentiment, with Bitcoin’s market cap dropping from $1.2 trillion in 2021 to around $500 billion as of 2023. This regulatory pressure has led some companies to consider relocating abroad to avoid stringent U.S. regulations. 

Biden’s Treasury Department has also issued warnings about the potential risks of cryptocurrencies, including concerns about their environmental impact, particularly Bitcoin mining. For some, this reinforces Biden’s perception as “anti-crypto.”

The founder of the decentralized cryptocurrency exchange Uniswap, Hayden Adams, shared his views on Biden’s administration’s crypto regulations in an X tweet, saying, “Republicans smell blood in the water and are turning hard towards crypto.”

Trump’s Pro-Crypto Stance

In stark contrast, Donald Trump’s views on crypto have evolved considerably. Initially skeptical, even critical, Trump now recognizes the potential economic benefits of a thriving crypto market. His previous administration took a relatively hands-off approach, allowing innovation to flourish. Trump has recently hinted at favorable policies that could bolster the industry, such as tax incentives for crypto startups and a more lenient regulatory framework.

Interestingly, proponents of former president Donald Trump point to Trump’s appointment of pro-crypto figures like Hester Peirce, also known as “Crypto Mom,” to the Securities and Exchange Commission (SEC) as evidence of his support for the industry.

Despite this, some crypto advocates remain skeptical, questioning whether Trump would make good on his promises. However, as the saying goes, “actions speak louder than words,” Trump’s history with crypto has been more positive than his rival incumbent.

Sentiments

In a move many in the crypto community see as a slap in the face, the Biden campaign is exploring accepting crypto donations. This move, seen by some as the epitome of audacity, comes in response to political winds showing that crypto impacts both the presidential and congressional elections.

Conversely, Trump has criticized Biden’s crypto policies and promised to end what he calls Biden’s “war on crypto” if he returns to office. During an event celebrating his 78th birthday at Club 47 in West Palm Beach, Florida, Trump emphasized the need for the U.S. to lead in the crypto industry.

Economic Impact

The numbers don’t lie. Since Biden’s presidency, Bitcoin’s market cap has seen significant volatility, dropping from an all-time high of $1.2 trillion in November 2021 to fluctuating around $500 billion. This has led to massive losses for investors and impeded the growth of new blockchain projects. Conversely, during Trump’s tenure, the crypto market experienced exponential growth, driven by a more laissez-faire approach to regulation.

With the election approaching, the stakes have never been higher for the crypto community. The future of the crypto market hangs in the balance, and Trump’s potential return to the White House could herald a new era of prosperity for digital currencies. At the same time, another term under Biden may tighten the regulatory noose even further, stifling innovation yet more, or maybe not. But we’ll see.