2024 US Election: Donald Trump and Kamala Harris on Crypto

Former President and Republican Nominee for the 2024 Presidential Election, Donald Trump, arrived with an emphatic statement of support for cryptocurrencies at the 2024 Bitcoin Conference in Nashville in late July. It was an about-face for the former president, who during his term as president did not mince words when it came to his feelings on Bitcoin and cryptocurrencies.

Needless to say, the conference’s attendees were elated, and Bitcoin’s share price popped to nearly $70,000 soon thereafter.

It’s often suggested that effective politicians can always be swayed. In the case of Trump, it would appear that the pivot from his 2019 stance to the present has a lot to do with his voter base, donors, and current stance from regulators and the Biden administration.

According to a July 2023 Morning Consult survey, 26% of millennials owned Bitcoin.1 That’s an attractive group of potential voters, as is the donor class that is also interested in a crypto-friendly occupant in the White House.

Source: B2B Broker. July 1, 2024. “Top 10 Crypto-Friendly Countries for Your Business in 2024.”

In June, venture capitalist David Sacks held a swanky fundraiser for the former President in his Pacific Heights, San Francisco mansion. Guests paid up to $300,000, with rumored attendees spanning the C-suites of some of the U.S.'s largest crypto and blockchain companies.2

Meanwhile, it didn’t take much work for Trump’s team to compile a list of the regulatory crackdowns occurring at the hands of the Securities and Exchange Commission Chair, Gary Gensler. A Biden appointee, Gensler has sued crypto companies for violating securities laws and sought to dissuade banks from serving crypto companies.3

The Democratic Presidential nominee has remained relatively silent. Her website now features an “Issues” page supporting the growth of AI and “cutting-edge industries,” but Ms. Harris’s position on crypto policy is still vague. This may change, as there is a lot of money being poured into political action committees (PACs) in 2024. Blockchain companies have supplied roughly half of these campaign contributions.4

Source: Dale, Brady. August 22, 2024. “Crypto is dominating corporate election spending.” Axios.

Fairshake is the crypto industry’s preeminent PAC. As opposed to backing a single party, Fairshake supports defenders of the wider crypto sector and has endorsed equal numbers of Republicans and Democrats in House races in 2024.5

Crypto-optimists point to the Vice President’s record of working closely with the tech community when she was California’s Attorney General from 2011 to 2017. Part adversary while also supporting some tech-friendly measures, Harris was never accused of being inaccessible. Moreover, she maintains personal ties to the tech sector through her sister’s marriage with Uber Legal Officer Tony West and her niece’s marriage to prominent tech sector veteran Nik Ajagu.6

The Democratic party has long been divided over Bitcoin and crypto policy. Outspoken Senator Elizabeth Warren (D-Mass.) is a staunch critic of crypto, while major donor and Harris supporter Mark Cuban has voiced his support for a more amicable stance on digital assets.7 The federal prosecution of Sam Bankman-Fried, coupled with the regulations enacted by Gensler, have painted the Biden/Harris administration as anti-crypto. Trump’s aggressive support will likely push Kamala Harris to a softer position, or at least strategic ambiguity.

Trump’s comments weren’t the only news-grabbing pieces from the 2024 Bitcoin Confererence. Senator Cynthia Lummis (R-WY) announced a proposed bill to establish a strategic Bitcoin reserve to strengthen the dollar and fortify the US's position in the global financial system.8

The U.S. government currently holds over 183,000 Bitcoin, making it the largest geopolitical owner of Bitcoin on the planet.

Source: Quill, Vince. July 29, 2024. “United States government holds $12B in Bitcoin - Arkham Intelligence.” Cointelegraph.

While strategic reserves in hard assets like petroleum and gold are normal, the proposed bill aims to acquire 1 million Bitcoins or 5% of the currency’s maximum supply over an undefined period. Based on the current price, this would equate to a $500 billion acquisition, which would invariably push up the price significantly. Some in the industry question the practicality of such a move.9

Moreover, unlike petroleum or gold reserves, selling massive amounts of Bitcoin would then push the price lower, which begs the question - what would the US accomplish or do with this reserve?

Outside of the conference and the 26% of millennials who own Bitcoin, data from a Pew Research survey in 2023 suggests the wider public does not believe cryptocurrencies are safe or reliable.10

Source: Faverio, Michelle, and Sidoti, Olivia. April 10, 2023. “Majority of Americans aren’t confident in the safety and reliability of cryptocurrency.” Pew Research Center.

These are striking figures, suggesting the crypto sector is still, in many ways, in its infancy when it comes to educating the broader public. Additionally, environmental pressures have been mounting around the electricity Bitcoin mining consumes, although the green contingent has not been overly noisy for the moment.

Source: Martin, Katie, and Nauman, Billy. May 20, 2021. “Bitcoin’s growing energy problem: ‘It’s a dirty currency.” Financial Times.

Following the implosion of FTX, the crypto market has climbed back to roughly $2.5 trillion in value.11

Source: Cuthbertson, Anthony. February 29, 2024. “Bitcoin price live: Crypto market nears record high as experts make 2024 predictions.” Independent.

Kamala Harris on crypto is foggy at best, but no forward-looking analysis would be complete without the thoughts of the Oracle of Omaha, Warren Buffet. In the case of Bitcoin and cryptocurrencies as a whole, Buffet’s opinion hasn’t changed over the years:

On September 10th, Trump and Harris faced off in their first debate. A range of topics were addressed, including the supposed consumption of family pets by illegal migrants. Kamala Harris’s position on crypto, nor Trump’s for that matter, were discussed. Harris’s strong performance coupled with Taylor Swift’s endorsement of the Vice President’s candidacy, may have resulted in cryptocurrency shares falling in premarket trading.

Some analysts believe that Bitcoin will likely hit an all-time high regardless of who wins the White House.13 President Biden’s regulatory stance is not expected to continue at the same fervor with either candidate, and while Trump might appear to be the favorable crypto candidate, the sector is also poised to grow with Vice President Harris at the helm. Perhaps Harris’s stance on crypto policy can remain obscure for the time being.

Sources:

1. Royal, James. September 4, 2024. “Cryptocurrency statistics 2024: Investing in crypto.” Bankrate.
2. Schwartz, Brian, and Sigalos, MacKenzie. July 2, 2024. “Crypto takes its fight with SEC directly to Biden and Trump.” CNBC.
3. The Editorial Board. July 29, 2024. “Trump Becomes a Crypto Convert.” Wall Street Journal.
4. Dale, Brady. August 22, 2024. “Crypto is dominating corporate election spending.” Axios.
5. Ibid.
6. WSJ Pro Staff. July 29, 2024. “For Business, Harris’s Record Fuels Both Optimism and Uncertainty.” The Wall Street Journal.
7. Zahn, Max. July 29, 2024. “Where do Trump and Harris stand on cryptocurrency?” ABC News.
8. Cynthia Lummis, Senator for Wyoming. July 27, 2024. “Lummis Announces Revolutionary Proposal to Supercharge the Dollar, Bolster U.S. Economy.”
9. Yue, Frances. July 31, 2024. “Trump pledged to build a U.S. bitcoin reserve. Here’s why it may not be a good idea.” MarketWatch.
10. Faverio, Michelle, and Sidoti, Olivia. April 10, 2023. “Majority of Americans aren’t confident in the safety and reliability of cryptocurrency.” Pew Research Center.
11. Dugan, Kevin T. July 30, 2024. “Is Kamala Harris, a Former Prosecutor, Really Warming Up to Crypto?” New York Magazine.
12. Mancini, Jeannine. March 6, 2024. “Warren Buffet Says He Wouldn’t Pay $25 For All The Bitcoin In The World - He Considers Crypto ‘Rat Poison’ and Warns: ‘I Can Say With Almost Certainty That They Will Come To A Bad Ending.” Benzinga.
13. Elliot, Stacy. September 12, 2024. “Bitcoin Will Hit New High Price If Trump or Harris Wins, Says Analyst – But Bettors Favor Kamala.”Decrypt.