In November 2024, an event of great importance to the cryptocurrency community will occur—the US presidential election. The United States is the largest hub of the crypto industry; therefore, the future of the digital asset market largely depends on the attitude of the country's leader towards this new financial tool.
Unlike previous US presidential races, the outcome of the upcoming election could be significantly influenced by members of the crypto community. Here’s why and how the presidential candidates are vying for the votes of crypto investors.
How crypto enthusiasts can change the course of the election
The traditional financial system has many drawbacks, one of which is inflation that erodes people's savings. Many citizens have addressed this problem by investing in cryptocurrencies, including Bitcoin (BTC)—a deflationary asset that consistently grows, multiplying investors' holdings.
These problems have not spared the US. As inflation skyrocketed in the country, Americans sought ways to preserve their savings, and many turned to crypto. While in 2021 only 16% of US citizens had ever invested in cryptocurrency, traded digital assets, or conducted operations with them, by 2024, the number of crypto investors in the US had reached 40%. Moreover, 77% of American citizens believe that "presidential candidates should have an informed perspective on innovative technology, like AI or crypto". Specifically, a stance on crypto plays a decisive role for 20% of Americans.
This means that opponents of cryptocurrencies automatically lose a large portion of the electorate. Therefore, candidates for the U.S. presidency have suddenly "warmed up" to digital assets.
How politicians are adapting to the crypto community
Former US President Donald Trump and current President Joe Biden are the two main contenders for victory in the 2024 election. Poll data shows that the politicians are running almost neck and neck.
Results of the 2024 US Election Campaign Polls. Source: projects.fivethirtyeight
Trump has clearly decided to leverage the power of the crypto community. To this end, the politician publicly criticizes Biden for his lack of understanding of crypto. Trump also promises to protect the rights of the crypto community and has even agreed to accept donations in crypto for his election campaign.
For the crypto community, such behaviour from the former US President is surprising. Just a few years ago, Trump called Bitcoin a scam and spoke disparagingly about representatives of the crypto industry. However, his criticism of the crypto community and digital assets did not prevent him from earning millions from the sale of NFTs.
Biden's position in the eyes of the crypto community appears weaker. He has repeatedly promoted initiatives aimed at tightening regulation of the crypto industry and increasing tax burdens. For example, Biden supported an initiative to introduce a 30% tax for miners.
It is worth noting that the US is the largest hub for Bitcoin mining. Introducing such a large tax on miners could result in a market shakeup. American crypto community members involved in BTC mining would be forced to find a new home. In this case, they would have to temporarily shut down mining equipment, weakening the Bitcoin network and potentially causing the cryptocurrency's price to drop. This already happened in 2021 following China’s ban on mining, which was once the largest BTC mining centre.
However, ahead of the election, Biden has eased pressure on the crypto industry, likely to gain some votes from crypto community representatives.
What kind of president does the crypto community need?
Between Biden and Trump, the latter appears to be the preferred candidate in the eyes of crypto investors. Trump promises to reduce pressure on the digital asset market, support crypto investors, and promote the US as a centre of the crypto industry.
If Biden's administration wins, they may continue to push for legislation that is negative for the crypto community.
🤔 What do you think about the 2024 elections in the US?
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This article is not an investment recommendation. The financial transactions mentioned in the article are not a guide to action. Itez is not responsible for possible risks. The user should independently conduct an analysis on the basis of which it will be possible to draw conclusions and make decisions about making any operations with cryptocurrency.
