Regardless of the outcome of next week's presidential election, the SEC is likely to welcome a new chair. Traditionally, the SEC chair tends to resign when a new president takes office. Therefore, whether Harris or Trump wins, the leadership of the SEC may face significant changes.
According to Unchained, supporters of Harris's campaign are pushing for her to replace the current chair, Gary Gensler, and have begun vetting candidates. If a Harris administration takes office, it may adopt a more crypto-friendly policy than the Biden administration to improve the regulatory environment. However, she remains cautious on key issues such as taxation, Bitcoin mining, and self-custody, showing less pro-crypto sentiment than Trump.
On the other hand, Trump promised at the Bitcoin conference that if elected, he would "fire" Gensler on his first day in office. Although he cannot legally fire Gensler directly, he does have the authority to demote him to commissioner immediately, a position that has led the crypto industry to have high expectations for Trump's regulatory policies.
Trump's Pro-Crypto Policy Review
The Republican Party has consistently emphasized individual freedom, aligning its values with the decentralized principles of cryptocurrency. The Republican National Committee has pledged in its platform that Trump will defend the right to mine Bitcoin and "ensure that every American has the right to self-custody digital assets and can trade freely without government surveillance." In contrast, the Democratic Party typically advocates for increased government power and regulation, which may create ideological friction with the cryptocurrency community.
Trump has shown a strong interest in the digital asset industry, claiming his goal is to make the U.S. a "global crypto center and Bitcoin superpower." He supports Bitcoin mining and promises to protect self-custody rights. Additionally, during his campaign, Trump used Bitcoin to buy hamburgers for restaurant patrons and criticized the SEC's tough stance on cryptocurrencies, vowing to appoint a pro-crypto chair if re-elected. Trump even launched his own DeFi project—World Liberty Financial.
Trump has proposed a series of crypto policies, including:
- Establishing a Strategic Bitcoin Reserve
Trump stated that the government would "retain all Bitcoin currently held or acquired by the U.S. government" as the "core of a strategic national Bitcoin reserve." As of October 2023, the U.S. government holds over $5 billion worth of Bitcoin, primarily seized through criminal investigations. However, it remains unclear how these Bitcoin reserves will be utilized, their feasibility, and whether the crypto industry will widely accept this initiative.
- Establishing a Crypto Presidential Advisory Committee
Trump promised in Nashville to establish a "Bitcoin and Crypto Presidential Advisory Committee," stating that the committee would be composed of "industry supporters" rather than "crypto skeptics" to formulate rules.
- Prohibiting the Federal Reserve from Issuing Digital Currency
While many countries are advancing central bank digital currencies, this trend has faced resistance within the U.S. cryptocurrency community. Although the Federal Reserve has not yet decided whether to issue a digital dollar, a report released in January 2022 detailed the potential costs and benefits of a CBDC.
Trump has publicly opposed this proposal multiple times, calling it "a dangerous threat to freedom." In May 2024, the House passed a bill prohibiting the Federal Reserve from issuing a CBDC, although the bill still needs further advancement to become law. It is worth noting that while Trump supports cryptocurrencies, his tariff policies may create economic uncertainty. The long-term impact of his policies on the market and the crypto industry remains to be seen.
"Crypto Mom" Hester Peirce May Not Become SEC Chair
With Gensler potentially stepping down, the industry is looking forward to a new crypto chair, with the most vocal candidate being SEC Commissioner Hester Peirce, who is nicknamed "Crypto Mom" in the industry.
Hester Peirce has publicly criticized Gensler for regulating the industry through litigation rather than rule-making. On the surface, if Trump wins the White House, she seems to be a likely candidate, as she has been the most vocal Republican on the commission under Gensler's leadership, and presidents typically nominate chairs from their own party.
When asked in an interview what her top priority would be if she became SEC chair, Peirce responded, "to ensure the vitality of the industry, allow investors to make their own decisions, and ensure we do not set unnecessary barriers in rule-making."
However, according to Unchained, four sources close to Peirce or who frequently communicate with her revealed that Peirce does not want to become SEC chair and plans to leave the commission after her term ends in June 2025. A spokesperson for Peirce's office stated, "The only thing Commissioner Peirce is considering doing after leaving is becoming a beekeeper, but even that she is somewhat hesitant about."
Sources agree that Peirce has been clearly indicating her desire to leave the SEC for at least several months, with one source stating they heard about her wish to resign a year ago.
Will Harris Continue the Biden Administration's Crypto Regulatory Pressure?
During the Biden administration, regulatory pressure on cryptocurrencies significantly increased, with the SEC filing charges against several crypto asset exchanges. To address the rapid development of the crypto market, Biden signed an important executive order on digital assets, directing government agencies to strike a balance between regulation and development.
This executive order aims to ensure that digital assets find a balance between innovation and security to promote the healthy development of the crypto market while reducing potential systemic risks. Under these measures, the crypto industry faces higher compliance pressures, especially in ensuring market transparency and investor protection.
In addition to direct regulation, the SEC has also implemented stricter information disclosure requirements under the Biden administration, particularly in the areas of environmental, social, and governance (ESG). The new rules require publicly traded companies to provide more information about their operating models and potential risks in response to investor concerns about corporate social responsibility and risk management. This initiative not only affects traditional companies but also indirectly impacts businesses involved with crypto assets, requiring them to disclose more operational details to the public.
Related: "Why Does Everyone Want to Regulate Crypto?"
Harris has made limited statements regarding cryptocurrency policy, only indicating that her administration will "encourage innovative technologies like AI and digital assets while protecting our consumers and investors." Recently, in response to lower-than-expected support among Black voters, she proposed a series of economic security plans, including a commitment to establish a regulatory framework for cryptocurrencies aimed at protecting Black male investors.
However, this framework is only targeted at Black voters and lacks clear regulatory details or specific policy positions, leading the cryptocurrency community to criticize it as hypocritical, viewing it as merely a ploy to win votes. The current Biden-Harris administration has taken a more confrontational regulatory approach toward the crypto industry, engaging in multiple lawsuits, restricting traditional banking services, and vetoing bipartisan legislation.
Harris's "Advisors" Are Not Friendly
Alex Thorn, head of research at Galaxy, pointed out in a post that there is evidence suggesting that Harris and her advisory team will continue the Biden administration's approach to cryptocurrencies. "New evidence indicates that Harris will continue to crack down on cryptocurrencies; her choice of advisors suggests she will maintain Biden's hostile attitude toward crypto, as Harris is collaborating with two key anti-crypto officials from the Biden administration, Brian Deese and Bharat Ramamurti."
To support his analysis, Alex Thorn elaborated on key evidence of Brian Deese and Bharat Ramamurti's opposition to cryptocurrencies. He noted that Brian Deese wrote an article back in January 2023 that, while claiming to support innovation, effectively labeled cryptocurrencies as "fraud" and "dangerous." As for Bharat Ramamurti, he has long worked alongside anti-crypto Democratic Congresswoman Elizabeth Warren and provided economic policy advice to her.
On the other hand, both Brian Deese and Bharat Ramamurti have intervened in the U.S. stablecoin legislation, advocating for comprehensive regulation of stablecoins by the Federal Reserve and banks. In summary, a series of evidence indicates that both Brian Deese and Bharat Ramamurti are not friendly toward cryptocurrencies, and Harris's choice to include them in her advisory team may signal disappointment for crypto enthusiasts if she ultimately wins.
Billionaire investor Mark Cuban also believes that Harris's team leans toward opposing an "enforcement regulatory" model, preferring to promote the development of the crypto market through clear regulatory frameworks. Cuban pointed out that Harris "prefers clear regulatory provisions rather than relying on litigation," a method that allows businesses to avoid relocating overseas for development.
Other industry observers believe that even if Harris replaces Gensler, the enforcement intensity in the cryptocurrency market will not diminish. Analysts from the renowned firm Bernstein predict that if Harris wins, Bitcoin's price may see a significant decline by the end of the year, potentially dropping by 10%.
Note: This article is a summary based on previous articles published by BlockBeats.
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