Vice President Kamala Harris is under scrutiny for her unclear stance on crypto regulation, especially as her 2024 presidential campaign progresses. Vivek Ramaswamy and others have called for Harris to clarify her position on key crypto issues, including self-custody of assets and the SEC's leadership. While some Democrats, like Senator Chuck Schumer, express support for pro-crypto legislation, others believe Harris may continue the Biden administration's strict regulatory approach.
Harris Must Clarify Crypto Position
Vivek Ramaswamy appeared on CNBC on Aug. 13, where he was questioned about Vice President Kamala Harris' stance on the crypto industry. Ramaswamy suggested that Harris might alter her rhetoric on crypto to attract votes from the crypto community, especially since former President Donald Trump has made crypto a campaign issue.
Vivek Ramaswamy’s CNBC interview (Source: CNBC)
According to Ramaswamy, Harris' sincerity on pro-crypto positions should be measured by the specificity of her policy stances on issues like self-custody of assets and the leadership at the Securities and Exchange Commission (SEC). Ramaswamy also challenged Harris to go beyond just general statements and clearly express her beliefs on these critical topics.
He concluded that while crypto should not be a partisan issue, Harris' detailed policy positions on crypto could benefit the country and the broader marketplace of ideas, even if they differ from his own views.
Harris' campaign has come under a lot of scrutiny after a recent regulatory enforcement action by the U.S. Federal Reserve against Customers Bank, which is a crypto-friendly institution. This move caused backlash in the crypto industry, with people like Gemini co-founder Tyler Winklevoss questioning the sincerity of Harris' so-called crypto “reset.” Winklevoss believes the action is evidence that Operation Chokepoint 2.0, which seeks to isolate the crypto industry from traditional banking services, is still very active.
In contrast, the Trump campaign has very effectively leveraged the crypto issue by taking specific policy initiatives. Despite prediction markets indicating a close race between Harris and Trump, Harris' lack of clear policy positions on digital asset regulation could very likely alienate single-issue crypto voters.
Trump has capitalized on the issue by speaking at the Bitcoin 2024 conference in Nashville and proposing policies like paying off the U.S. national debt with Bitcoin. He also urged the Biden administration not to sell U.S. Bitcoin holdings.
Democrats Rally Behind Digital Assets
It seems like some politicians have taken the crypto industry’s advice to heart. Democratic Senator Chuck Schumer, who is the majority leader of the United States Senate, announced at the Crypto4Harris Town Hall meeting that he is committed to passing bipartisan pro-crypto legislation by the end of the year if Kamala Harris is elected president.
Schumer believes it is important for the United States to encourage crypto innovation, and also warned that if lawmakers continue to ignore the issue, crypto could move overseas to countries with little to no regulation. He wants to bring together members of both parties in the Senate to create momentum for more sensible legislation that will help the U.S. maintain its status as a leader in innovation.
The Crypto4Harris event is part of a broader grassroots effort to encourage a pro-crypto stance in Harris' campaign, as she still has to clarify her position on crypto policy. Many pundits believe she may continue the Biden administration's approach, which has been extremely hostile to crypto firms.
Billionaire investor Mark Cuban spoke at the event, and criticized Trump and the Republican party by accusing them of being more interested in enriching Bitcoin maximalists than supporting genuine innovation. Additionally, Democrat Congressman Wiley Nickel voiced support for the crypto industry while also taking a jab at Trump for his previous hostility towards crypto.
Senator Debbie Stabenow, chair of the Senate Agriculture Committee, also stated that she is commitmed to providing a regulatory structure that protects consumers while still allowing innovation to flourish. She has been working with the Commodities Trading Futures Commission (CFTC) to regulate crypto assets as commodities rather than securities. This will place them under the CFTC’s jurisdiction, which is considered much more favorable to the crypto industry compared to the SEC led by Gary Gensler.
Enforcement actions during Gensler administration Arp. 2021 - Dec. 2023 (Source: Cornerstone Research)
Several other Democratic politicians, including Colorado Governor Jared Polis, Senator Kirsten Gillibrand, and Representatives Elissa Slotkin and Adam Schiff, also expressed their support for the crypto industry through a mix of pre-recorded and live statements. SkyBridge Capital founder Anthony Scaramucci advocated for a less tribal and more bipartisan approach to crypto policy as well.
Crypto4Harris organizers plan to start raising funds in September to support their efforts in building pro-crypto momentum in the Harris campaign.
Circle CEO Says Harris Campaign is Focused on Crypto Policy
According to Circle CEO Jeremy Allaire, representatives from Kamala Harris’ presidential campaign have been making efforts to better understand crypto-related policies as the 2024 United States elections approach. In an Aug. 14 interview with CNBC, Allaire stated that the passage of digital asset-related legislation in the current session of Congress suggests that crypto is a “purple” issue, meaning it holds significance for both Democrats and Republicans.
Circle CEO interview with CNBC (Source: CNBC)
He also shared that he participated in an Aug. 8 video call with White House officials, Harris campaign representatives, and U.S. lawmakers, where industry leaders were able to gauge the positions on digital assets.
Allaire believes that both the current administration and the Harris campaign are making a concerted effort to familiarize themselves with the key issues, industry players, and policy concerns related to crypto. Allaire pointed out that it would have been hard to believe two years ago that crypto would become a major presidential political issue.
Since launching her campaign on July 21, after President Joe Biden's announcement that he would not seek reelection, Harris still has to announce a comprehensive economic policy platform that could impact the crypto industry. However, reports indicate that her team has been in discussions with industry executives about crypto policy and is considering whether to take a public position on the matter.
Harris' Economic Team Points to Strict Crypto Regulation
On the other hand, others believe Kamala Harris seems poised to maintain the Biden administration's stringent stance on crypto regulation as she prepares for the 2024 presidential race. Harris is reportedly working closely with Brian Deese and Bharat Ramamurti, two former economic advisers from the Biden administration who have been vocal critics of the Clarity for Payment Stablecoins Act of 2023. They argue that it was too lenient towards issuers.
This choice of advisers has led some, like the head of research at Galaxy Alex Thorn, to suggest that Harris will continue the Biden administration's hostile approach to crypto regulation. Thorn shared his thoughts in an Aug. 13 post on X, where he indicated that Harris' selection of economic advisers signals a likely continuation of Biden’s tough stance on crypto.
Harris is expected to outline her economic policy agenda in a mid-August speech, which could provide more insights into her approach to crypto regulation. Concerns about the future of crypto regulation have been heightened by Harris’ association with Deese and Ramamurti, who have been linked to “Operation Chokepoint 2.0”, which is a term that was coined by crypto venture capitalist Nic Carter to describe what he saw as a coordinated effort to isolate the crypto industry from the banking system after the collapse of Silicon Valley Bank, Silvergate Bank, and Signature Bank in March of 2023.
Bharat Ramamurti, who served as a Deputy Director of the National Economic Council until October 2023, has been referred to as the “White House’s top crypto critic,” which also suggests a potentially tough regulatory environment for the crypto industry under a Harris administration.
According to Thorn, the people Harris surrounds herself with are key to shaping policy, and the involvement of people like Deese, Ramamurti, and others suggests that a Harris administration is very unlikely to adopt a more lenient stance on crypto.
