Over the past four years, President Joe Biden has demonstrated a clear reluctance to support the Bitcoin and cryptocurrency industry, as evidenced by his recent veto of major legislation and his administration's broader stance. On May 31, Biden vetoed a crucial bill that would have allowed highly trusted financial institutions to hold Bitcoin and other cryptocurrencies.
BREAKING: 🇺🇸 President Biden Vetoes Bill That Would Allow Highly Regulated Financial Firms to Hold Securities #Bitcoin and crypto. pic.twitter.com/TMHavdWRx7
– Bitcoin Magazine (@BitcoinMagazine) May 31, 2024
The legislation in question had garnered bipartisan support in the House and Senate. It aimed to provide a regulatory framework that would allow banks and other financial entities to securely hold digital assets, thereby further integrating Bitcoin into the traditional financial system. Supporters of the bill argued that such a framework would strengthen the security of spot Bitcoin ETF funds by distributing the honeypot of coins currently held by only a few institutions, foster innovation, and help facilitate the growth of the Bitcoin industry. However, Biden's veto reflects his administration's lack of support for the industry, where the president previously compared crypto traders to “rich tax evaders.”
The Biden administration also published a report attacking Bitcoin and proof-of-work mining, promoting a central bank digital currency (CBDC), stating “A US CBDC would have the potential to offer significant benefits.” Biden wanting to enact a CBDC, which would allow the federal government to have full control over its citizens' finances, further shows his true colors and reasoning for not supporting Bitcoin.
Recently, Joe Biden's Justice Department arrested the founders of the popular privacy-focused Bitcoin mixing service Samourai Wallet and charged them with money laundering. US Senator Cynthia Lummis defended the founders of Samourai, stating that “this position contradicts existing Treasury guidance, common sense and violates the rule of law.” Noted whistleblower Edward Snowden also commented on the arrest:
NEW: Edward Snowden on US Justice Department arrest #Bitcoin mixing service Founders and CEO of Samourai Wallet pic.twitter.com/qmigHJzmZU
– Bitcoin Magazine (@BitcoinMagazine) April 24, 2024
Additionally, the Democratic Party in general has also shown reluctance to support pro-Bitcoin legislation. Key figures like Senator Elizabeth Warren have been particularly opposed to the crypto industry. Warren has often criticized cryptocurrencies for their environmental impact and regulatory challenges, and infamously said she is “building an anti-crypto army” to confront what she perceives as the industry's threats to financial stability and consumer protection.
In contrast, former President Donald Trump recently embraced Bitcoin and cryptocurrencies. On June 1, 2024, Trump announcement that his campaign would accept Bitcoin payments through the Lightning Network, facilitated by OpenNode, a Bitcoin and Lightning Network infrastructure provider. Trump recently said he would “ensure the future of crypto and Bitcoin is made in the United States…I will support self-custody rights for the country's 50 million crypto holders “. Trump also recently said that he is “very positive and open-minded about crypto companies” and that “Our country needs to be the leader in the field.” There is no second place.
Despite the Democrats' position, the Bitcoin industry is becoming an increasingly influential force in American politics. Recent polls indicate that crypto voters are largely nonpartisan, with no significant leaning toward the Republican or Democratic parties. This demographic represents a large and growing portion of the electorate, with more than 50 million Bitcoin and crypto holders in the United States. As the 2024 presidential election approaches, Bitcoin policy is emerging as a crucial issue for candidates to address.
The evolving stance of political leaders towards Bitcoin and cryptocurrencies highlights the growing importance of these assets in economic and regulatory policymaking. For Biden, his reluctance to embrace Bitcoin is alienating a significant portion of the voting base. Crypto proponents argue that clear regulatory frameworks and widespread acceptance of Bitcoin would boost economic growth, foster innovation, and improve financial inclusion. However, the Biden administration remains focused on preventing such a situation.
The rise of Bitcoin has introduced a new dynamic into the political landscape. Although Bitcoin operates in a non-partisan manner, attracting individuals from across the political spectrum, this does not mean that all politicians will adopt it. Joe Biden and the Democrats are turning a nonpartisan technology into a partisan issue.
In conclusion, the Biden administration and the majority of Democrats favor a CBDC rather than a decentralized cryptocurrency like Bitcoin. A CBDC aligns more with Biden and the Democrats than Bitcoin, as Bitcoin is less appealing to them as it does not help them achieve their authoritarian goals.
As the 2024 presidential election approaches, the role of Bitcoin politics in determining voter preferences and political strategies is becoming increasingly evident. With more than 50 million Bitcoin and crypto holders in the United States, political leaders' decisions regarding digital assets will likely play a central role in the upcoming election, reflecting the growing importance of Bitcoin in the economic and political landscape more wide.