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The Crypto Surge: How a Pro-Crypto Administration Could Reshape the Industry
The Crypto Industry's Election Spending Pays Off
The crypto industry's massive spending in the 2022 election cycle appears to have paid off, with nearly every single candidate backed by crypto's biggest political action committees declared winners. Coinbase alone poured over $75 million into pro-crypto candidates, part of the industry's $35 million in total election spending.
The industry's strategy was not to focus on crypto itself, but rather on broader "kitchen table" issues like immigration and inflation. This suggests the industry recognized crypto may not be a top priority for most voters, and instead sought to defeat politicians seen as adversaries to the crypto space.
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"It just tells you what happens when you've got a handful of demagoguing politicians who pick on a group of Americans who are trying to build an industry here and try to use unlawful means to do so," said Faryar Shirzad, Coinbase's chief policy officer.
The Outlook for Crypto Policy Under a Pro-Crypto Administration
With a more crypto-friendly administration in place, the industry is hopeful for tangible policy changes that will provide the regulatory clarity it has long sought. Shirzad outlined two key priorities:
Legislation to give the CFTC authority to regulate crypto commodity spot markets and direct the SEC to create openings for tokenized securities trading.
Rules around the issuance of U.S. dollar-backed stablecoins, which make up 98% of the stablecoin market.
Shirzad believes these measures could come quickly, unlocking significant opportunities for the industry to build the "next generation of the payments infrastructure and financial architectu
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The Global Implications
The shift in the U.S. political landscape could also impact the crypto industry's global outlook. While China remains a different case, Shirzad says other major markets around the world have been aggressively courting crypto companies that have faced political and regulatory headwinds in the U.S.
Now, with the prospect of a more favorable environment in the U.S., Coinbase plans to continue investing globally, including in its second-largest market, the European Union, as well as the UK, Asia, and Latin America. However, the company also sees a significant opportunity to build within the U.S.
The Lasting Impact on U.S. Politics
The crypto industry's massive election spending may have lasting implications for U.S. politics. Shirzad believes it has shown other industries facing "politicization" that they can use similar tactics to engage with policymakers.
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Moreover, the industry's bipartisan appeal, with both progressives and Republicans finding reasons to support crypto, could make it a rare unifying force in a deeply divided political landscape. As Shirzad put it, "we're very much kind of one of the few bipartisan issues left in town."
The industry's success in this election cycle suggests crypto has become a force to be reckoned with in U.S. politics, and its influence is likely to continue growing in the years to come.