Regulation
The year of elections could also be the year of crypto
2024-05-27 16:05:59 ET
2024 is shaping up to be a pivotal year for cryptocurrencies, as political and regulatory landscapes evolve across major economies.
The United States has already seen significant developments, such as the SEC’s approval of a spot Ether ETF, signaling a potential softening of regulatory stances towards digital assets.
This comes at a time when former President Donald Trump and current President Joe Biden are making strategic moves to court the crypto community, paving the way for a crucial election that could significantly influence the future of cryptocurrency regulation.
With the world watching, other major economies, including India and the United Kingdom, are also grappling with their own regulatory frameworks and political dynamics, making 2024 a crucial year for the global crypto market.
US Elections Could Reshape Crypto Regulations
The political landscape in the United States is undergoing significant changes with potential implications for the cryptocurrency market.
Former President Donald Trump and current President Joe Biden have adjusted their positions on cryptocurrencies, which could have a significant impact on the future of the market.
Trump’s campaign recently began accepting donations in various cryptocurrencies, including Bitcoin (BTC), Ethereum (ETH), and US Dollar Coin (USDC), as well as smaller coins like Shiba Inu (SHIB) and Dogecoin ( DOGE).
The move appears to target young male voters who are increasingly investing in digital assets. Trump has already shown his support for cryptocurrencies, raising millions through his Trump Digital Trading Cards NFT projects.
In contrast, the Biden administration is signaling a potential shift in its approach to regulating cryptocurrencies. The recent approval of a spot Ether ETF by the Securities and Exchange Commission (SEC) indicates a more favorable stance toward digital assets.
This change could bring the administration closer to the crypto community ahead of the November elections. However, Biden remains focused on consumer protection and financial stability, which should lead to stricter regulations.
“The SEC’s approval of a spot Ether ETF suggests a strategic pivot,” says Grindery CEO Tim Delhaes.
“This could mean a looser regulatory environment for crypto under the Biden administration.”
The minor role of crypto in the 2024 Indian elections
In India, where the population exceeds 1.4 billion, the importance of cryptocurrencies in the upcoming elections is minimal.
The country, which has 93.5 million crypto owners (6.55% of the population), has seen significant regulatory measures under Prime Minister Narendra Modi’s administration.
These include a 30% tax on profits from the sale of digital assets, no compensation for losses and a 1% tax withheld at source for each transaction.
Despite these measures, crypto remains a niche issue among Indian voters.
More pressing economic and social concerns are overshadowing the debate over digital assets. The BJP manifesto, for example, focuses on educating senior citizens about digital scams and tackling threats to digital sovereignty.
The Indian National Congress (INC) is emphasizing digital ledgers for agricultural transactions and addressing cybersecurity issues within the financial infrastructure.
Balaji Srihari, Head of Sales at CoinSwitch, told Invezz:
We believe the government’s approach to taxing cryptocurrencies is part of a broader effort to protect investors and ensure the stability of the financial system. Given the history of the crypto ecosystem, such cautious policy moves are understandable.
UK Election Delays Crypto Legislation
The UK’s crypto landscape has also been affected by political developments. Prime Minister Rishi Sunak’s call for a general election on July 4 has delayed new crypto legislation, pushing back long-sought regulations by at least six months.
This delay comes as other regions, including the European Union, Dubai, and Hong Kong, accelerate their crypto regulatory frameworks.
Ian Taylor, an advisor to the board of trade body CryptoUK, expressed concerns about the delay.
It’s really negative, because we are lagging behind. We lag behind the rest of Europe first, then other countries in Asia and the Middle East.
Despite these short-term delays, the long-term growth of the UK crypto industry, supported by a global financial center and significant investment capital, remains promising.
Both main political parties have pledged to make the UK a hub for digital financial services.
Global Implications of Crypto Regulations
The upcoming elections in these major economies will significantly influence the future of cryptocurrency regulation globally.
In the United States, the outcome of the presidential election could determine the pace and nature of cryptocurrency regulation, impacting international standards.
If Biden wins, expect a continuation of current regulatory approaches. If Trump wins, the emphasis could shift, affecting the pace of international crypto regulation.
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2024: The year of elections could also be the year of crypto
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