Where the top six potential Biden replacements land on Crypto

President Biden’s dismal debate performance Thursday night has Democrats considering a replacement ahead of next month’s nominating convention in Chicago. Although the president appears determined to remain at the top of the ticket, attention is shifting, at least for now, to how these successors might perform in the general election and their policies on critical issues.

A few thousand votes could be decisive, and suddenly crypto becomes a winning election issue for Republicans, including former President Donald Trump. Although Trump said he was “not a fan” of cryptocurrencies while in office from 2016-2020, he did an about-face in late May, promising to make the United States a world leader in cryptocurrencies by ending regulatory hostility. Republicans in Congress are also leading efforts to craft crypto-friendly legislation that would pave the way for the broad assimilation of the $2.4 trillion industry into the U.S. economy.

This policy shift contrasts sharply with the Biden administration, which drew the community’s ire. This is largely due to the Securities and Exchange Commission’s (SEC) propensity under Chairman Gary Gensler to sue exchanges and token issuers for alleged violations of 90-year-old federal securities laws instead of acceding to industry demands give by creating new crypto regulations.

“Imagine if there are 20,000 people in Wisconsin who are one-issue voters, and they’re like, “You know what? I’m either not going to show up and push the button for Joe Biden, or I’m going to vote for Trump because he’s pro-crypto,” said Trump’s former White House communications director Anthony Scaramucci, who is now supporting Biden’s re-election campaign. .

Furthermore, the crypto industry is flexing its muscles more than ever. On the back of bitcoin hitting an all-time high of $74,000 in March, political action committees focused on crypto issues have raised more than $100 million, the third most of any cause this election cycle, from the likes of Coinbase, Coinbase CEO Brian Armstrong, Ripple, Andreessen Horowitz, and Cameron and Tyler Winklevoss, according to a report from Public Citizen. They have already defeated anti-crypto candidates in key primaries New York and California. These ready-to-spend funds could become even more critical for a Biden replacement who must quickly assemble a campaign war chest.

Neither candidate has responded to Forbes requests about their cryptocurrency policy since Thursday night’s debate, but here’s an overview of their past positions and legislative history in the industry.

Vice President Kamala Harris

Vice President Kamala Harris has been tight-lipped about her stance on cryptocurrency regulation despite being from the tech-dominated San Francisco Bay Area. However, if she were to accept the candidacy (or presidency, for that matter), it is fair to expect that her policies would mimic those of the current president.

The Biden administration pledged to take a “whole of government” approach to regulating crypto, signing an executive order in September 2022 outlining six priorities: consumer and investor protection, financial stability, financial crimes, global competitiveness , financial inclusion and innovation, even though most of the activity so far has focused on enforcement actions by the SEC. President Biden also recently vetoed a congressional repeal of SEC Staff Accounting Bulletin 121, which essentially prohibited banks from holding digital assets like bitcoin and ether on behalf of customers, much to the industry’s dismay.

Gavin Newsom, Governor of California

Newsom has taken a cautious stance on cryptocurrency regulation as the elected leader of a state known for both progressive policies and technological innovation.

In May 2022, the start of the bear market, Newsom signed an executive order to create a framework for licensing cryptocurrency companies in the state. However, he vetoed a draft of such a bill that September, a few weeks before the FTX accident, saying it was “premature to include a licensing structure” and that “a more flexible approach is needed .” The governor was criticized by consumer advocates for not acting in time, in response to which he told the Los Angeles Times he did not regret his decisions.

Newsom eventually signed Bill 39, titled the Digital Financial Assets Law, in October 2023, which directs the Department of Financial Protection and Innovation (DFPI) to create a licensing and enforcement framework for the state by July 1, 2025. At the time of signed, Newsom warned of “ambiguity” in the law and urged further refinement, while the DFPI is currently open for public comment.

California’s law has the potential to compete with New York’s BitLicense regulatory regime, a controversial piece of legislation that is nonetheless the strongest regulatory construct in the country. According to Bloomberg Law, about one in four North American cryptocurrency companies is headquartered in California.

Jared Polis, Governor of Colorado

Polis is the potential Democratic presidential nominee most friendly to the cryptocurrency industry. The Libertarian-leaning Democrat positions cryptocurrency as an example of technological and financial freedom, describing it as an antidote to “big government” at the state capitol on Feb. 27, so-called “Blockchain Day,” 2022.

Like Trump, Polis has accepted campaign contributions in cryptocurrencies, and has accepted major tokens like bitcoin and ether and even “memecoins” like dogecoin and shiba inu coins. The state of Colorado also began accepting tax payments in cryptocurrencies under its leadership in 2022, although such payments must be made through the Paypal Cryptocurrencies Hub, which converts them to fiat before the transaction.

However, most of Polis’ industry advocacy ended after 2022. Speaking at ETH Denver in February of that year, Polis said he wanted Colorado to become “the first digital state.” He also spoke at the convention in 2020 and 2021. In 2022, he also speculated about putting the state’s cattle brand registry on the blockchain to make government processes more efficient, transparent and decentralized. He said the state’s cooperative business laws make it an ideal place to create a decentralized autonomous organization, or DAO. Polis then said that he does not personally own any cryptocurrency.

In 2016, when Polis was a member of the House of Representatives, he was a founding member of the Congressional Blockchain Caucus.

Polis has not spoken about cryptocurrency since the collapse of FTX.

JB Pritzker, Governor of Illinois

Pritzker has been relatively quiet about cryptocurrency, engaging with the industry primarily as an opportunity to promote economic development in Chicago. In 2021, for example, Pritzker traveled to cryptocurrency trading platform Coinflip’s Grant Park-adjacent offices to celebrate the announcement of its new headquarters there. Pritzker said that “the future of crypto is in Illinois.” Like Polis, much of Pritzker’s technology enthusiasm has shifted to support for the quantum computing industry since 2022.

The Illinois State Financial Protection Agency announced a set of consumer protection laws for cryptocurrency last February, but Pritzker has not publicly taken credit for them. The set of two bills focuses on updating financial regulations for digital money transfer, which a press release compares to New York’s BitLicense and California’s proposed licensing structure, and strengthening enforcement of the regulations for the sake of protecting everyday people. Democratic state representatives Mark Walker and state senator Laura Ellman sponsored the bills.

Pennsylvania Governor Josh Shapiro

Shapiro has not publicly shared his perspectives on federal regulation of cryptocurrencies. However, state tax breaks created to encourage the creation of data centers in the state have been used by crypto mining companies, lowering taxpayer costs from $5 million to $90 million by 2027. for allegedly polluting the environment while receiving $29 million in tax credits from the state over the past two years.

Pennsylvania’s Department of Banking and Securities has moved to include “cryptocurrency” in its definition of “money” when overseeing the state’s money transmission law, effectively saying it has the authority to regulate certain aspects of the cryptocurrency industry. to regulate in the state. This is a reversal of a 2019 policy in which the department said it did not consider cryptocurrencies for its purposes. There have been no major regulatory actions as a result yet, and Shaprio has not taken responsibility for or commented on the change.

Gretchen Whitmer

Michigan Governor Gretchen Whitmer has also yet to comment publicly on cryptocurrencies. In December 2019, the final year of Whitmer’s first year in office, four bills were enacted to include cryptocurrencies and distributed ledgers in the state’s criminal code, allowing the state to prosecute financial crimes. State laws also require a license to transmit money, which includes “funds in an e-wallet,” according to the Department of Insurance and Financial Services.