Cryptocurrency at a crossroads: two different fates facing the industry after the election

Regardless of the outcome of next week's presidential election, the SEC is likely to have a new chairman. Traditionally, the SEC chairman usually resigns when a new president takes office. Therefore, whether Harris or Trump wins, the SEC's leadership may face major adjustments.

According to Unchained, Harris' campaign supporters are pushing her to replace the current chairman Gary Gensler and have begun to review candidates. If the Harris administration comes to power, it may adopt a more crypto-friendly policy than the Biden administration to improve the regulatory environment. However, she remains cautious on key issues such as taxation, Bitcoin mining, and self-custody, and is not as pro-crypto as Trump.

On the other hand, Trump promised at the Bitcoin Conference that if elected, he would "fire" Gensler on his first day in office. Although he cannot legally fire Gensler directly, he does have the power to demote him to a commissioner immediately, a position that makes the crypto industry full of expectations for Trump's regulatory policies.

Review of Trump's pro-crypto policy

The Republican Party has always emphasized individual freedom, and its values are more consistent with the principle of cryptocurrency decentralization. The Republican National Committee promised in its party platform that Trump would defend the right to mine Bitcoin and "ensure that every American has the right to self-custody digital assets and can trade freely without government surveillance." In contrast, the Democratic Party generally advocates strengthening government power and regulation, which may have ideological friction with the cryptocurrency community.

Related reading: "If Trump wins the election, what new opportunities will there be for cryptocurrencies and BTCFi? "

Trump has shown a strong interest in the digital asset industry, claiming that his goal is to make the United States a "global crypto hub and Bitcoin superpower." He supports Bitcoin mining and promises to protect the right to self-custody. Additionally, during the campaign, Trump used Bitcoin to buy burgers for restaurant customers and criticized the Securities and Exchange Commission (SEC) for its tough stance on cryptocurrencies, vowing to appoint a pro-crypto chairman if re-elected. Trump even launched his own DeFi project, World Liberty Financial.

Trump has proposed a series of crypto policies, including:

· Establish a strategic Bitcoin reserve

Trump said the government will "retain all Bitcoin currently held or acquired by the U.S. government in the future" as the "core of the strategic national Bitcoin reserve." As of October 2023, the U.S. government holds more than $5 billion worth of Bitcoin, mostly confiscated through criminal investigations. However, it is unclear how these Bitcoin reserves will be used, how viable they are, and whether the crypto industry will widely accept this move.

· Establish a Presidential Advisory Committee on Cryptocurrency

In Nashville, Trump promised to set up a "Presidential Advisory Committee on Bitcoin and Cryptocurrency," and said the committee would be made up of "industry supporters" rather than "crypto skeptics" to set rules.

· Ban the Federal Reserve from issuing digital currencies

While many countries are moving forward with central bank digital currencies, the trend has encountered resistance in the U.S. cryptocurrency community. Although the Federal Reserve has not yet decided whether to issue a digital dollar, a report it released in January 2022 detailed the possible costs and benefits of CBDCs.

Trump has publicly opposed the proposal many times, calling it a "dangerous threat to freedom." In May 2024, the House of Representatives passed a bill that would ban the Federal Reserve from issuing CBDCs, although the bill still needs to be further advanced before it can become law. It should be noted that while Trump supports cryptocurrencies, his tariff policy may cause economic uncertainty. The long-term impact of its policies on the market and the crypto industry remains to be seen.

“Crypto Mom” Hester Peirce may not serve as SEC Chairman

Now that Gensler is likely to step down, the industry is also looking forward to a new crypto chairman. Currently, the most popular one is Hester Peirce, a member of the U.S. Securities and Exchange Commission, who is also nicknamed “Crypto Mother” in the industry.

Hester Peirce has publicly criticized Gensler’s approach to regulating the industry through litigation rather than rulemaking. On the surface, she also seems to be a very likely candidate if Trump wins the White House, because under Gensler’s leadership, she has been the most vocal Republican on the committee, and the president usually nominates a chairperson from his own party.

When asked in an interview what his top priority would be if he became the chairman of the SEC, Peirce replied, "Ensuring the vitality of the industry, allowing investors to make their own decisions, and ensuring that we do not create unnecessary obstacles in rulemaking."

Related reading: "Exclusive Interview with "Crypto Mom" Hester Peirce: How do you view the future regulatory direction of the SEC? "

But according to Unchained, four sources who are close to Peirce or communicate with her frequently revealed that Peirce does not want to serve as SEC chairman and plans to leave the committee after her term ends in June 2025. A spokesperson for Peirce's office said, "The only thing Commissioner Peirce has considered doing after leaving office is becoming a beekeeper, but even so, she is a little hesitant."

Sources agree that Peirce has been making it clear for at least several months that she wants to leave the SEC, and one of the sources said he heard her desire to leave a year ago.

Will Harris continue the Biden administration's crypto regulatory pressure?

During the Biden administration, the regulation of cryptocurrencies has been significantly strengthened. The SEC has filed charges against several crypto asset exchanges during this period. In response to the rapid development of the crypto market, Biden signed an important digital asset executive order instructing government agencies to strike a balance between regulation and development.

This executive order aims to ensure that digital assets find a balance between innovation and security to promote the healthy development of the crypto market while reducing its potential systemic risks. Under these measures, the crypto industry faces higher compliance pressure, especially in ensuring market transparency and investor protection.

In addition to direct supervision, the SEC has also implemented stricter information disclosure requirements under the Biden administration, especially in the field of environment, society and governance (ESG). The new rules require listed companies to provide more information about their operating models and potential risks in response to investors' concerns about corporate social responsibility and risk management. This move not only affects traditional companies, but also indirectly affects companies involved in crypto assets, requiring them to disclose more operating details to the public.

Related reading: "Why does everyone want to regulate Crypto? 》

Harris has limited comments on cryptocurrency policy, saying only that her government will "encourage innovative technologies like AI and digital assets while protecting our consumers and investors." Recently, in response to lower-than-expected support among black people, she has proposed a series of economic security plans, including a promise to establish a cryptocurrency regulatory framework aimed at protecting black men's crypto investments.

But this framework only targets black voters and lacks clear regulatory details or specific policy positions, so it has been criticized by the cryptocurrency community as hypocritical, believing that it is just using cryptocurrency to win votes. The current Biden-Harris administration has taken a more confrontational regulatory approach to the crypto industry, taking actions such as multiple lawsuits, restricting traditional banking services, and vetoing bipartisan legislation.

Harris's "guests" are not friendly

Galaxy Research Research Director Alex Thorn published an analysis that there is evidence that Harris and her team of advisers will continue the Biden administration's attitude towards cryptocurrencies. "New evidence shows that Harris will continue to suppress cryptocurrencies, and her choice of advisers shows that she will continue Biden's hostility to cryptocurrencies because Harris is working with two key officials in the Biden administration who oppose cryptocurrencies, Brian Deese and Bharat Ramamurti."

To confirm his analysis, Alex Thorn detailed the key evidence of Brian Deese and Bharat Ramamurti's opposition to cryptocurrencies. He pointed out that Brian Deese wrote an article as early as January 2023, which was named as supporting innovation, but actually labeled cryptocurrencies as "fraudulent" and "dangerous." As for Bharat Ramamurti, he has worked with Elizabeth Warren, a Democratic congressman in the United States, a crypto villain, and has provided economic policy advice to Warren.

On the other hand, Brian Deese and Bharat Ramamurti also intervened in the US Stablecoin Act, advocating that the Federal Reserve and banks should fully regulate stablecoins. In short, a series of evidence shows that Brian Deese and Bharat Ramamurti are not friendly to cryptocurrencies, and Harris's choice of them to join her advisory team may indicate that if she wins the election, she may disappoint people in the currency circle.

Billionaire investor Mark Cuba also believes that Harris's team tends to oppose the "law enforcement and supervision" model and hopes to promote the development of the crypto market through a clear regulatory framework. Cuban pointed out that Harris "prefers clear regulations rather than litigation", which allows companies to develop applications without moving overseas.

Other industry observers believe that even if Harris replaces Gensler, the enforcement of laws in the cryptocurrency market will not be weakened. Analysts from the well-known analysis company Bernstein predict that if Harris wins, the price of Bitcoin may fall significantly by the end of the year, and may even fall by 10%.

Note: This article is a summary of the articles published by BlockBeats in the past