Has Biden really changed his stance on crypto?

Over
the
last
few
weeks,
US
President
Joe
Biden
has
started
reaching
out
to
major
players
in
the
crypto
space,
potentially
signaling
that
his
administration
is
walking
back
their
recent
crypto
crackdown.

However,
with
election
season
rapidly
approaching,
the
industry
finds
itself
questioning
what
to
expect
in
the
long
run.

Biden’s
unpopular
crypto
crackdown

The
Biden
administration
has
been
supportive
of
controversial
SEC
crypto
tax
and
custody
regulations
that
many
in
the
crypto
industry
have
criticized
as
impractical
and
detrimental
to
the
space.

The
regulations
would
see
to
it
that
investors
would
be
unable
to
write
off
capital
gains
losses
on
unprofitable
crypto
trades
made
in
quick
succession
or
between
similar
assets,
making
many
types
of
crypto
trading
and
yield
farming
untenable.

Financial
institutions
dealing
in
crypto
would
also
be
required
to
adhere
to
lengthy
crypto
custody
reporting
guidelines
that
would
consume
resources
and
potentially
overwhelm
the
accounting
departments
of
even
the
largest
businesses
in
the
industry.
The
administration
states
that
these
guidelines
could
generate
$40
billion
in
tax
revenue
over
the
next
decade.

These
guidelines
are
part
of
the
SEC’s
Staff
Accounting
Bulletin
rules
called

SAB
121.
Biden
has
signaled
that
he
aims
to
overturn
a
recent
ruling
to
scrap
these
guidelines,
with
lawmakers
and
industry
participants
throughout
the
crypto
and
blockchain
space
urging
him
to
reconsider,
and
crypto
lobbyists
have
donated
$78
million
in
funding
to
politicians
supporting
crypto-friendly
tax
and
custody
regulations.

Crypto
super
PAC
fights
back

Three
separate
political
action
committee’s
have
joined
forces
to
create
a
super
PAC
aimed
at
funding
pro-crypto
politicians.
The
three
groups
are
called
Protect
Progress,
Fairshake,
and
Defend
American
Jobs.

While
the
full
list
of
donors
will
not
be
available
until
early
next
year
when
campaign
finance
reports
are
disclosed,
a
number
of
household
names
are
reportedly
taking
part.

The
list
so
far
includes
P2P
payments
giant
Circle,
which
has
long
been
supportive
of
bringing
in
clear
regulations
from
government
into
crypto
and
crypto
banking
settlement
provider
Ripple,
which
would
be
seriously
affected
by
the
proposed
regulations
andd
has
now
increased
its
total
donation
to
$50
million
since
last
year.

Other
super
PAC
members
are
crypto
exchange
Kraken,
the
Paradigm
investment
firm,
and
a
number
of
individual
donors
including
Coinbase
CEO
Brian
Armstrong.

The
fund
has
reportedly
raised
approximately

$110
million
so
far
to
donate
to
candidates
that
would
influence
regulations
in
their
favor
and
away
from
the
restrictive
guidelines
proposed
in
SAB
121.

Joe
Biden’s
new
stance
on
crypto

The
Biden
administration
has
reportedly
been
reaching
out
to
crypto
institutions
and
experts
for
discussion
on
the
nature
of
crypto
regulations
in
recent
weeks.

While
the
super
PAC
group
is
focused
on
congressional
candidates
for
the
moment,
it’s
likely
that
the
major
investment
has
drawn
a
line
in
the
sand
for
incumbent
President
Biden
ahead
of
the
presidential
elections
this
November.

It’s
also
possible
that
recent

Ethereum
ETF
approvals
by
the
SEC
could
be
signaling
a
more
welcoming
climate
for
crypto
projects
overall,
further
softening
Biden’s
stance.
With
crypto
becoming
increasingly
integrated
into
mainstream
institutional
finance,
the
proposed
SEC
regulations
would
likely
have
wider
ramifications
throughout
the
financial
industry
that
the
Biden
administration
may
not
have
foreseen.

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

While
Biden’s
recent
engagement
with
members
of
the
crypto
industry
has
been
warmly
received
and
taken
as
a
potential
change
in
tone
regarding
regulations,
there
is
no
cause
for
celebration
yet
for
crypto
users.

It’s
possible
that
the
situation
will
be
kept
on
ice
until
the
election,
where
a
victorious
Biden
would
be
in
a
much
stronger
position
in
terms
of
supporting
harsh
regulations
without
blowback.

For
now,
all
eyes
are
on
the
Biden
administration
to
see
whether
new
statements
will
be
issued
to
provide
more
clarity
on
the
current
stance
towards
crypto
tax
and
custody
and
crypto.news
will
be
monitoring
the
situation
closely.