Has Biden really changed his stance on crypto?

As a seasoned crypto investor with a keen interest in politics and regulatory developments, I’ve seen my fair share of ups and downs in this volatile market. The recent flip-flopping stance of the Biden administration towards crypto regulations has left many of us feeling uncertain about the future.

In recent weeks, US President Joe Biden has initiated contacts with significant figures in the cryptocurrency sector. This move could indicate a shift in stance from his administration regarding their previous tough stance on crypto.

As the election season draws near, there’s growing uncertainty within the industry about what lies ahead in the future.

Table of Contents

Biden’s unpopular crypto crackdown

The Biden government has expressed approval for the SEC’s contentious tax and custody rules regarding cryptocurrencies, which some members of the crypto sector view as unrealistic and harmful to the industry.

The regulations would prevent investors from deducting capital losses from frequent losing crypto transactions or between interchangeable assets, thereby rendering various crypto investment strategies and yield farming infeasible.

Crypto-handling financial institutions are expected to comply with extensive crypto custody reporting regulations, which may strain their resources and possibly burden the accounting units of major industry players. According to the government, these regulations have the potential to yield approximately $40 billion in tax income during the coming decade.

As a crypto investor, I’m subject to the SEC’s Staff Accounting Bulletin rules, specifically SAB 121. These guidelines have been a significant part of the regulatory framework for our industry. However, recent developments indicate that they may be scrapped. Biden has expressed his intention to reverse this decision, and many in the crypto and blockchain community, including lawmakers and industry insiders, are advocating for him to reconsider. Furthermore, crypto lobbyists have contributed a substantial amount of funding – around $78 million – to politicians who support tax and custody regulations favorable to our sector.

Crypto super PAC fights back

Three politically active committees, namely Protect Progress, Fairshake, and Defend American Jobs, have merged efforts to establish a single super PAC dedicated to financing political candidates who support cryptocurrencies.

As an analyst, I can’t yet reveal the complete roster of donors since the required campaign finance reports won’t be made public until early next year. However, it’s been reported that some well-known figures have contributed to the cause.

As a crypto investor, I’ve noticed that Circle, a well-known player in the P2P payments sector, has consistently advocated for clear-cut regulations from the government in our industry. Lately, they’ve upped their support with an additional donation of $50 million last year. On the other hand, Ripple, a leading crypto banking settlement provider, stands to face significant repercussions if these proposed regulations come into effect. They have already increased their contributions to this cause, donating a total of $50 million since last year.

Kraken is among the other prominent super PAC contributors, joined by the Paradigm investment firm and several individual donors, with Coinbase CEO Brian Armstrong being one of them.

As a crypto investor, I’ve learned that our industry’s future can hinge on regulatory decisions. Recently, reports indicate that our fund has managed to amass around $110 million. This capital is intended for supporting political candidates who could potentially shape regulations in ways favorable to us and steer clear of restrictive guidelines like SAB 121.

Joe Biden’s new stance on crypto

As a crypto investor, I’ve noticed that there have been reports of the Biden administration actively engaging with crypto institutions and industry experts in the past few weeks. They seem to be open to having conversations about the regulatory landscape surrounding cryptocurrencies.

The super PAC group is currently supporting congressional candidates, but its significant financial backing could signal a strong challenge to President Biden’s re-election bid come November.

An approval of Ethereum ETFs by the SEC could indicate a more favorable environment for cryptocurrency projects in general, potentially making Biden’s stance on crypto more lenient. As crypto gains popularity in institutional finance, any new SEC regulations would likely impact various sectors of the financial industry beyond what the administration might have anticipated.

What can crypto expect from a re-elected President Biden?

Biden’s latest interactions with crypto sector players have brought optimism and hope for more favorable regulation. However, it’s essential to remember that this doesn’t automatically mean a celebratory moment for crypto users just yet.

The situation might be put on hold until the election results are in. If Biden wins, he would then have greater leverage to implement strict regulations without facing significant opposition.

Currently, the focus is on the Biden administration as they may release new statements shedding light on their position regarding crypto taxes, custody, and regulation. CryptoNews will keep a keen eye on any developments in this regard.

Read More

2024-05-31 19:12