In a significant development for the cryptocurrency industry, Coinbase Inc. (NASDAQ:COIN) CEO Brian Armstrong emphasized the critical need for a bipartisan approach to cryptocurrency regulation during a discussion with Ark Invest CEO Cathie Wood. This conversation followed former President Donald Trump’s recent declaration of himself as a “crypto president” at a campaign event and his meetings with executives from major Bitcoin mining companies earlier in the week.
Wood acknowledged Trump’s polarizing nature but highlighted a positive aspect of his involvement: his support for cryptocurrency has brought the issue to the attention of those who might not have considered it before. “He’s considered very divisive, of course, by some people,” Wood said, according to DL News. Nevertheless, she noted that Trump’s advocacy has “educated those who haven’t taken a closer look at what this movement is all about,” underscoring the bipartisan nature of the issue.
Armstrong responded to Wood’s comments without directly mentioning Trump, but he emphasized that “both parties are recognizing that they need to address this issue,” highlighting the growing national importance of cryptocurrency. Throughout the discussion, Armstrong stressed the importance of bipartisan support for cryptocurrency, noting his recent meetings with up to 13 senators in Washington to discuss the matter. “We need clear rules in the US,” Armstrong stated, referring to the current regulatory landscape for cryptocurrency. “The current situation is untenable.”
This strategic neutrality by Armstrong reflects a broader campaign among crypto industry leaders to elevate digital assets as a critical national issue. In preparation for the upcoming state and national elections, Armstrong and other influential figures in the crypto industry have pooled substantial resources to support pro-crypto candidates.
FairShake PAC, a political action committee founded in December to promote favorable digital assets legislation, has raised nearly $93 million in donations, according to the Federal Elections Commission. Prominent donors include the Winklevoss twins, Coinbase, Ripple (CRYPTO: XRP), Marc Andreessen, and Ben Horowitz. Additionally, Stand With Crypto, a nonprofit launched by Coinbase last year, initiated its own PAC in March to back pro-crypto candidates.
Major industry figures, including Ryan Selkis, CEO of Messari, and David Bailey, head of Bitcoin Magazine, have publicly supported Trump. This endorsement comes in the context of Trump’s recent overtures to the cryptocurrency community, which represents a marked shift from his previous critical stance. Just a few years ago, Trump was openly skeptical of Bitcoin and other cryptocurrencies, describing them as “not money” and “based on thin air.” He maintained that position even after leaving office, as recently as 2021, when he called Bitcoin a “scam” and warned against the proliferation of unregulated crypto assets.
However, Trump’s position has evolved significantly, culminating in his recent declaration at the Libertarian Party’s national convention in Washington. There, Trump vowed to “stop Joe Biden’s crusade to crush crypto” and promised to ensure that the future of cryptocurrency would be “made in the USA.” He committed to supporting the right to self-custody for the nation’s 50 million crypto holders and pledged to protect their interests against regulatory overreach.
The shift in Trump’s stance is seen by the multibillion-dollar cryptocurrency industry as a potential for a friendlier regulatory climate in Washington under his leadership. This change comes as the industry faces new regulatory threats from Congress and the SEC, and as the Biden administration has maintained a more cautious approach to crypto regulation. Biden recently issued a rare veto of a crypto industry-backed resolution that would have overturned new Securities and Exchange Commission (SEC) guidance on cryptocurrencies. Biden’s message emphasized the necessity of “appropriate guardrails that protect consumers and investors” to harness the potential benefits of crypto-asset innovation.
Despite the industry’s growing political engagement and substantial financial backing, the broader appeal of cryptocurrency remains somewhat limited. According to a 2023 Pew Research Center survey, only 17% of Americans have ever traded or invested in cryptocurrency, and three-quarters of those aware of cryptocurrencies expressed a lack of confidence in their safety and reliability. However, the survey also revealed that crypto users tend to be younger, male, and racially diverse — a key demographic segment over which Biden, Trump, and Robert F. Kennedy Jr. are all competing.
Trump’s rhetorical about-face and the industry’s enthusiastic response suggest a significant shift in the political landscape surrounding cryptocurrency. As the industry mobilizes its resources and influence, key insights and developments will be explored at Benzinga’s Future of Digital Assets event on November 19. This event will provide a platform for further discussions on the evolving regulatory environment and the future of digital assets in the U.S.
Brian Morgenstern, the head of public policy at Riot Platforms, a Bitcoin mining company with a $3 billion market cap, published an op-ed in Bitcoin Magazine after meeting with Trump, declaring him the “best choice for Bitcoin.” Morgenstern praised Trump’s commitment to protecting Bitcoin owners’ rights and criticized the Biden administration for its perceived hostility towards Bitcoin.
The involvement of major industry players and substantial financial backing indicates a concerted effort to shape the future of digital assets in the U.S. regulatory environment. As the political and regulatory landscape continues to evolve, the cryptocurrency industry’s engagement in the political process is likely to play a crucial role in determining the direction of future policies and regulations.