Crypto got the president (and Senate) it wanted
11/06/2024 22:55
Cryptocurrencies are rallying as investors become more optimistic that a victory by Donald Trump and GOP control of the Senate will mean a more favorable approach to the industry in Washington, D.C.
The crypto world spent more than $100 million to elect more industry-friendly politicians this year, and it paid off this week.
The US elected as president Donald Trump, who made a number of promises to the industry, and the citizens of Ohio elected pro-crypto candidate Bernie Moreno to the US Senate.
Moreno’s victory means the Senate will be controlled by Republicans in 2025, spurring optimism that pro-crypto legislation could be possible in Washington, D.C.
Trump has promised to fire Securities and Exchange Commission Chair Gary Gensler, one of the industry’s greatest antagonists. He has also pledged to appoint a crypto presidential advisory council and establish a "strategic national bitcoin stockpile" with the help of Congress.
Digital assets rallied on the electoral victories. Bitcoin (BTC-USD) briefly climbed to $74,659 late Tuesday evening, its highest price ever as measured by Yahoo Finance. It is currently trading at $74,000.
"Being anti-crypto is actually bad politics," Coinbase (COIN) CEO Brian Armstrong said on X Wednesday morning in a post that included a picture of the Ohio Senate race where Sherrod Brown, a known critic of digital assets, lost to Moreno.
Coinbase is expected to be a major beneficiary of pro-industry regulation. The company is facing an expensive legal battle with the SEC over whether some of the cryptocurrencies that trade on its platform are securities.
The stock of Armstrong’s cryptocurrency exchange surged 19% Wednesday morning.
Through a nonpartisan super PAC called Fairshake, Coinbase was also one of the crypto industry’s largest political donors during this election season. That PAC focused on funding opponents of current members of Congress known to be critics of the digital asset space.
As of Wednesday morning, 250 "pro-crypto" candidates vying for a US House seat were elected this year versus 113 "anti-crypto" candidates, according to crypto lobby organization Stand With Crypto.
In the Senate, 16 "pro-crypto" candidates have been elected compared to 10 "anti-crypto" candidates, including prominent Democrat Elizabeth Warren, according to the lobbying group.
Democrat Tammy Baldwin, another politician identified by the lobbying group as "strongly against crypto," won her Wisconsin Senate race.
One prominent victory for the pro-crypto crowd came in Montana, where strong industry supporter Tim Sheehy, a Republican, beat Democrat Jon Tester for a Senate seat. Tester was viewed by the industry lobbying group as neutral on crypto.
Followers of the crypto industry are expecting digital assets to continue rallying as investors absorb the implications of this week’s election.
"We think the market’s first reaction could be to 'sell the news,' but we suggest investors in stocks with exposure to Bitcoin use the marginal dip here as an enhanced buying opportunity to capture the upside over next 12 months," Bernstein analyst Gautam Chhugani said in a Wednesday note.
The firm has a "high-conviction" call for bitcoin's price to reach $200,000 before the end of 2025.
Trump himself could benefit from a surge in digital assets. Trump's family will receive 22.5 billion units of a crypto token, WLFI, that is part of a venture known as World Liberty Financial.
“Whether we like it or not, I have to do it,” he has said about that venture.
David Hollerith is a senior reporter for Yahoo Finance covering banking, crypto, and other areas in finance.