June 5, 2024
Policy & Regulation

Biden’s Crypto Flip-Flop: Genuine Shift or Strategic Move?

Biden’s Crypto Flip Flop

The most significant development at Consensus 2024 is the notable shift within the Democratic Party regarding cryptocurrency regulation. President Biden’s administration, initially adopting a stance that was almost hostile toward crypto, has shown signs of a remarkable pivot. Following the industry’s downturn in 2022, often referred to as the “year from crypto hell,” the administration had maintained a stringent regulatory approach, exemplified by the term “Operation Choke Point 2.0,” coined by venture capitalist Nic Carter to describe the debanking of many crypto firms. However, recent actions indicate a potential shift.

Legislative Changes and Outreach Efforts

In a surprising turn of events, the House and Senate voted to repeal the U.S. Securities and Exchange Commission’s (SEC) contentious accounting bulletin (SAB121). Moreover, the Biden administration has reportedly begun outreach efforts to crypto firms, aiming to understand what effective crypto policy should entail. This change suggests a more favorable future for the domestic crypto industry on political, regulatory, and legislative fronts. The mood at Consensus 2024 reflects this optimism, with NYSE President Lynn Martin expressing confidence that crypto will soon transcend partisan divisions.

Divergent Opinions on Biden’s Intentions

Despite the apparent positive shift, not everyone is convinced. A prominent crypto lawyer from a leading DeFi startup, preferring anonymity, questioned the genuineness of Biden’s crypto flip-flop. He argued that Biden might revert to his previous stance if reelected. Austin Campbell, a Columbia University business lecturer, echoed this skepticism, noting that the recent congressional shift might not be permanent. He pointed out that the voting on the Financial Innovation and Technology for the 21st Century Act (FIT21) revealed generational divides, suggesting that younger legislators might be more supportive of crypto, even as older lawmakers dominate for now.
Debates on the Main Stage
During Consensus 2024, Messari founder Ryan Selkis and Uniswap Labs chief lawyer Marvin Ammori debated the political dynamics surrounding crypto. Selkis argued that any easing of crypto regulations by Democrats could be attributed to Trump capturing the “single-issue” crypto vote, urging caution. Ammori, on the other hand, emphasized the bipartisan collaboration that led to changes like SAB121 and FIT21, advocating for a non-partisan approach to crypto policy. Selkis stressed the importance of realistic expectations, suggesting that Democrats’ newfound interest in crypto might be driven by shifting political needs rather than genuine support.

A Cautious Optimism

Consensus 2024 highlights a potential turning point in the political landscape for cryptocurrency. While President Biden’s crypto flip-flop signals a possible easing of previous regulatory hostility, the future remains uncertain. Industry stakeholders remain divided on whether this shift represents a lasting change or a temporary strategic adjustment. As the debate continues, the crypto community is advised to maintain cautious optimism and avoid aligning too closely with any single political party.

Image by Gordon Johnson from Pixabay

Disclosure Statement: Miami Crypto does not take any external funding, or support to bring crypto news to the readers. We do not have any conflicts of interest while writing news stories on Miami Crypto.

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