The crypto lobby in the Biden era clashes daily with Washington in an almost existential fight for legitimacy. If Donald Trump returns to power, Republicans predict a dramatic pendulum swing. Our Jasper Goodman has a new piece that begins to flesh out the GOP agenda for crypto if Trump and his party return to power. It illustrates how the upcoming election is the most consequential in the emerging industry’s history. Republican lawmakers and some Trump administration alumni expect he would usher in personnel and policy that would likely boost digital asset firms. It would be a big shift from the skeptical-to-hostile approach taken by leading Democrats under President Joe Biden. House Majority Whip Tom Emmer, one of Capitol Hill’s top crypto proponents, told Jasper that Trump “will be a lot more friendly to the crypto industry.” Brian Brooks, a veteran crypto executive who also served as a Trump bank regulator, said Trump’s appointees “are much more likely to at least be crypto-open, if not overtly crypto-friendly, than this administration.” “The general thrust of Republican opinion on this is, we should have proper consumer protections without destroying a very nascent industry,” Sen. J.D. Vance said. Why is this happening? Trump as president derided bitcoin and other digital currencies, warning in a 2019 tweet that they were “based on thin air.” But many Republican leaders in the ensuing years have warmed up to and even courted the crypto faithful as a way to tap into broader concerns about government overreach. “At the moment, in the populist movement on the right, there’s more fear about the Fed manipulating monetary policy, there’s more fear about central bank digital currencies, which would tend to drive you in a crypto-friendly direction,” Brooks said. A likely target to shift course on crypto would be to shake up the SEC, which has taken a tough approach going back to the Trump years. Republicans are floating the names of potential SEC chairs seen as less antagonistic toward the industry, including Brooks, SEC Commissioner Hester Peirce and former SEC Division of Investment Management director Dalia Blass. For crypto advocates, the warm embrace of the GOP is a big opportunity but also a big risk as they seek bipartisan support to open up a lasting regulatory pathway. Ron Hammond, director of government affairs at the Blockchain Association, pushed back on the idea that crypto policy has gotten more partisan. He said he isn’t taking for granted that Trump would pursue a friendly approach, given national security concerns among GOP defense hawks. In other crypto policy news, our Eleanor Mueller has a new story this morning digging into the digital asset politics around the race to succeed Rep. Patrick McHenry as the top Republican on House Financial Services. McHenry has been one of the crypto world’s most powerful champions, and the industry is eyeing Rep. French Hill as a reassuring replacement. Hill has told MM he’s no “crypto evangelist” – going as far as urging DOJ to take action against Binance and Tether – but he’s a known quantity for the crypto lobby. As digital asset subcommittee chair, he’s played a lead role in advancing McHenry’s sweeping legislation to carve out a new regulatory regime for crypto. The surprise retirement of Rep. Blaine Luetkemeyer, a potential frontrunner who would have been even more of a crypto wildcard, has scrambled the McHenry succession dynamics in recent days. The outcome could hinge on who the House Republican leader is heading into 2025. Happy Monday – Who do you think would be calling the shots on crypto and financial policy under Trump or Biden 2.0? Send tips and speculation to zwarmbrodt@politico.com.
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