The U.S. presidential elections have always been closely watched by people worldwide. From Biden being described as an “elderly man with a poor memory” to Trump exhibiting “questionable” behaviour, it’s been quite the show this year – and we’re still at the very start.
However, presidential elections go beyond just that.
Being a relatively new fintech sector, we didn't expect cryptocurrency to feature in the run up to the 2024 U.S. Presidential Elections at all. But as we are approaching the election, it seems more and more politicians are taking stand on crypto and forcing their rivals to do so.
The latest buzz is around controversy’s favourite child Donald Trump’s remarks on the central bank digital currency (CBDC).
Trump, former U.S. President and the Republican Party candidate for the 2024 Presidential Election, recently declared that he wouldn’t allow a CBDC in the country if he were to be elected.
The growth of the DeFi sector over the past few years has attracted a lot of people to the crypto market. The U.S. is the largest crypto market in the world in terms of trading volume. The rather strict policies of the U.S. regulator regarding the crypto industry have certainly raised eyebrows.
No doubt, cryptocurrency is fast becoming a much talked about topic during the campaigns for the 2024 U.S. Presidential Elections.
Let’s look at how different segments from the cryptocurrency sector feature in the campaign.
During President Joe Biden’s tenure, we have seen the government going tough on the cryptocurrency sector.
As several large ventures collapsed in the market, the regulatory body assumed a stricter role in controlling the market.
Things weren’t so bad either as only recently, spot Bitcoin (BTC) ETFs were granted approval to get listed in the U.S. market.
The regulatory hurdles to crypto under the current Democratic government elicited a critical response from the Republican side.
In fact, Trump himself owns a large amount of crypto assets.
Blockchain intelligence firm Arkham Intelligence published a finding that at the peak, a crypto wallet belonging to Trump held $4 million in Ethereum (ETH). In December 2023, he sold $2.4 million in ETH.
However, Biden doesn’t own any Bitcoin, he revealed way back in 2020.
There is a possibility of the regulatory environment in the U.S. softening towards crypto in the case of Trump’s victory.
“I will never allow the creation of a central bank digital currency,” Trump recently remarked during his election campaign. He compared CBDCs to government tyranny and a dangerous threat to freedom.
Trump’s remarks are not atypical of the GOP contenders vying for the top spot in the U.S. Office.
In fact, frontrunner Trump credited his one-time Republican primary rival Vivek Ramaswamy for introducing him to the vulnerabilities presented by CBDCs.
Even Florida’s Republican Governor and another one-time Trump rival Ron DeSantis had earlier “pre-emptively banned CBDCs” in his state.
On the other hand, President Biden issued an Executive Order in March 2022 that urged the Federal Reserve to explore a U.S. CBDC. The Order encouraged the Fed to continue its research, development, and assessment efforts for a U.S. CBDC.
The reason why CBDCs have generated so much discussion in the election campaign is because it is a government-issued digital currency. While the Biden government seems to be taking charge of the digital currency, Trump is trying to underline the alleged government interference in the economy and privacy violation among his libertine votes.
Though NFTs have not generated much discussion of late due to the declined market performance, that segment should definitely not be overlooked.
Trump has frequently used NFTs to generate personal income and raise funds for his election campaigns.
Trump again released an NFT collection in April 2023, with Both collections being completely sold out.
Trump came out with another NFT collection in December 2023 that focused on his court case.
The crypto leadership is very much active as three allied super political action committees (PACs) — Fairshake, Protect Progress and Defend American Jobs — funded by crypto hotshots will infuse $78 million into the 2024 U.S. Presidential Elections.
Crypto firms Circle, Ripple, and Coinbase support these PACs. They are also supported by crypto-focused venture capital firms Andreessen Horowitz (a16z) and ARK Invest.
The funds will support pro-crypto candidates in both the House and the Senate.
Unlike the TradFi market, the correlation between election years and DeFi market has not been studied much as it is a new sector.
The election results themselves won’t directly affect the crypto market. But the effect of the results on the TradFi market would certainly impact the crypto market, although in a lesser degree.
However, we should closely observe the differing outlooks of the opposing sides to the crypto sector. Once a candidate wins the 2024 U.S. Presidential Elections, it is their policies towards the sector that will get implemented and shape the crypto market in the U.S. and abroad.
The U.S. goes to the elections in November 2024.
This article is for informational purposes only and not intended as investment or financial advice. It contains opinions and speculations that are subject to change without notice.
The author and publisher disclaim any liability for decisions made based on the content of this article. Readers are advised to conduct their own research and consult a financial advisor before making investment decisions.