The upcoming November election could have significant implications for the crypto market, according to a recent note from TD Cowen. The possibility of a sweep of the executive and legislative branches by either Democrats or Republicans has raised concerns about increased risk for crypto assets.
Jaret Seiberg, a financial services and housing policy analyst for TD Cowen’s Washington Research Group, highlighted the potential impact of a divided government on the crypto industry. “Divided government is the best possible outcome for financial firms, housing, and crypto as we believe there would be bipartisan legislative and regulatory agreements that could survive future political changes,” Seiberg wrote in the note.
The election has become a hot topic for crypto investors, especially as former President Donald Trump has positioned himself as the candidate most in favor of crypto in his bid for re-election. While Republican politicians have generally held more crypto-friendly views, the industry maintains that crypto is a nonpartisan issue.
Last month, the House of Representatives passed a landmark crypto infrastructure bill in a bipartisan vote, signaling a growing understanding and importance of crypto in Washington. Seiberg predicts that if President Biden wins a second term with a Republican Senate, a bipartisan crypto market structure bill focused on investor protections for non-commodity tokens could be on the horizon.
However, the future of SEC Chair Gary Gensler, who has been seen as an adversary to the crypto industry, remains uncertain. Under his leadership, the SEC has been criticized for its lack of clear guidance for U.S. crypto businesses.
On the other hand, if Trump continues to position himself as a “crypto booster,” Seiberg believes that he would support the bipartisan crypto market structure bill and appoint regulators who prioritize guidance over enforcement.
Overall, the outcome of the November election could have far-reaching implications for the crypto market, with both potential risks and opportunities on the horizon. Stay tuned for more updates as the election approaches.