Cryptocurrency goes mainstream, how does it affect the US election?

[TL;DR]

According to a recent survey, 33% of American voters consider the political candidates' stance on cryptocurrency before making their voting decisions.

⭐️ The most popular presidential candidates at the moment are undoubtedly former President Trump and current President Biden, both of whom have undergone a transformation from criticizing to embracing cryptocurrencies.

Cryptocurrency policies and candidates' positions may become important factors in voters' decisions, shaping the future trajectory of this digital revolution through dialogue between policymakers, industry leaders, and voters.

Introduction

With the gradual transition from its initial fringe concept to the mainstream, cryptocurrency is playing an unprecedentedly important role in the 2024 US presidential election.

From the quiet change in voter perception to the hidden flow of political funds, and the shift in policy direction, cryptocurrency has become an important topic in the US presidential election. This article will discuss this in detail.

The Power of Encryption Voters That Cannot Be Ignored

In recent years, the popularity of cryptocurrencies among American voters has been rising. This trend is particularly evident among the younger generation, whose enthusiasm and acceptance of cryptocurrencies far exceed those of traditional voters, naturally demonstrating an increasingly significant influence in the political arena.

According to the latest report from Grayscale and Harris Poll, in a survey of over 1,700 potential voters in the United States, approximately 47% of American voters want to include cryptocurrency as part of their investment portfolio. 33% of American voters would consider a politician's stance on cryptocurrency before making a voting decision. 77% of voters believe that US presidential candidates should have at least some understanding of cryptocurrency. 44% of voters believe to some extent that "cryptocurrency and blockchain technology are the future of finance".

图 1 来源：@NateGeraci

On the other hand, the popularity of cryptocurrencies is not limited to private investors. Many enterprises and institutions have also begun to explore the potential of cryptocurrencies, especially since the approval of spot Bitcoin ETF and Ethereum ETF this year. The influence of the entire cryptocurrency industry in mainstream society is becoming increasingly strong.

And this widespread acceptance makes cryptocurrency an undeniable political issue, especially when considering its potential impact on economic policies and regulatory laws.

图 2 来源：Polymarket should be translated to English as: Image 2 Source: Polymarket

Meanwhile, the role of cryptocurrencies in political fundraising is becoming increasingly prominent. Super Political Action Committees (Super PACs) associated with digital assets have raised over $102 million in funding for the 2024 elections, ranking third among all Super PACs.

It is worth mentioning that these funds mainly come from direct expenditures by cryptocurrency companies such as Coinbase and Ripple Labs, demonstrating the cryptocurrency industry's full commitment to the election.

In general, the proportion of American cryptocurrency voters is increasing, which has become a force that is increasingly being followed in US political affairs. Even cryptocurrency voters have begun to actively participate in the election activities through fundraising and media advocacy, which objectively contributes to the further popularization of cryptocurrencies.

From Negative Criticism to Positive Embrace: Trump & Biden's Policy Shift

The current hottest presidential candidates are undoubtedly former President Trump and current President Biden, both of whom have undergone a transformation from criticizing to embracing cryptocurrency.

The attitude of the Biden administration towards cryptocurrency is relatively cautious. He previously signed an executive order directing government agencies to carefully study the benefits and risks that cryptocurrency may bring, and consider the creation of a US Central Bank Digital Currency (CBDC). This measure aims to ensure that cryptocurrency does not pose a threat to financial stability and national security, while also reflecting the Biden administration's emphasis on the digital economy.

However, this strong regulatory stance has sparked widespread backlash from the cryptocurrency industry and its supporters. And from recent actions, the Biden team is trying to ease this confrontational sentiment, attempting to gain support from crypto voters.

Recently, the Biden campaign team has been reaching out to key figures in the cryptocurrency industry to strengthen their social media influence, and has hired MEME experts to manage internet content and memes, while delving deep into cryptocurrency culture, demonstrating their team's emphasis on digital communication strategies. In fact, as early as the beginning of 2022, they tried to use the "Dark Brandon" laser eyes meme to connect with young voters in a more approachable manner.

Source of Figure 3: Public Information

Furthermore, the recent sudden policy shift by the SEC to give the green light to the spot Ethereum ETF has also been interpreted by the market as a political move by the current government to garner support from key voters in the cryptocurrency community.

However, Trump has shown a more explicit supportive attitude towards cryptocurrencies, attempting to increase his political leverage through a series of encrypted words and actions.

Despite his criticism of Bitcoin as a threat to the US dollar as early as 2019, his attitude has recently made a 180-degree turn. Trump announced last Tuesday that he would start accepting cryptocurrency donations, stating that this move is to unite those who are "opposed to the Biden administration's control of the US financial market."

Trump even promised recently that if elected president, he would consider pardoning Silk Road founder Ross Ulbricht and WikiLeaks founder Julian Assange, and emphasized the right of self-custody for 50 million cryptocurrency holders nationwide.

Image 4 source: @realDonaldTrump

This position undoubtedly has won wide support from the cryptocurrency community, adding many highlights to the upcoming election campaign.

Conflicts of Interest and Conceptual Differences in Cryptocurrency Policies Worth Following

With the increasing influence of cryptocurrencies in the US presidential election, their politicized potential risks are gradually emerging.

First, the anonymity and decentralization of cryptocurrencies may become a new channel for political fundraising, potentially making related policies more partisan and causing uncertain impacts on the long-term development of the crypto industry. For example, the case of Sam Bankman-Fried has brought potential risks to political supporters and greatly hindered the approval process of Bitcoin ETF.

Secondly, the policy-making of cryptocurrency also faces many challenges. As cryptocurrency involves multiple fields and departments, policy-making requires collaborative efforts among all parties to ensure the rationality and effectiveness of the policies. However, in the current political environment, conflicts of interest and ideological differences among the parties make policy-making exceptionally difficult.

For example, Jan3 CEO Samson Mow emphasized the importance of establishing exclusive regulatory regulations for Bitcoin to recognize its unique attributes and potential benefits, especially the challenges in regulatory transparency and consumer protection that cannot be ignored.

Finally, the development of cryptocurrency has also brought new economic and social issues. It requires deep thinking and exploration on how to balance the relationship between innovative development and regulatory standards, and how to ensure the stability and fairness of the cryptocurrency market.

图 5 来源：@Excellion

In conclusion, with more and more Americans investing in cryptocurrency and the preference of young voters for this emerging market, cryptocurrency has transitioned from a niche topic to an important issue that may impact the U.S. presidential election. This undoubtedly brings both opportunities and challenges to the development of cryptocurrency.

In the upcoming elections, cryptocurrency policy and candidates' positions may become important factors in voters' decision-making. The dialogue between policymakers, industry leaders, and voters will shape the future trajectory of this digital revolution.

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This article represents the author's opinion and does not constitute any trading advice.

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