July 15, 2024

Trump Courts Crypto Community at High-Dollar Fundraiser in San Francisco

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Recently venture capitalist David Sacks hosted a high-dollar Republican fundraiser at his Pacific Heights mansion. The guest of honor was none other than former President Donald Trump, who used the occasion to address the crypto community’s growing frustrations with current regulatory policies.

The event, with tickets costing up to $300,000, saw Trump pledging to loosen cryptocurrency regulations if he is elected in November. “Get out of the way of innovation,” Trump promised from a curtained stage, according to a person in attendance who spoke to CNBC.

During the event, Stuart Alderoty, chief legal officer of blockchain giant Ripple, voiced his company’s struggles under the Securities and Exchange Commission (SEC). Ripple has spent over $100 million defending itself in litigation initiated by the SEC under Chair Gary Gensler. Alderoty’s comments highlighted the broader industry’s discontent with the regulatory landscape, echoed by Paul Grewal, chief legal officer of Coinbase, who was also present.

The SEC’s aggressive stance has significantly impacted both Ripple and Coinbase, with lawsuits accusing the firms of violating securities laws. Ripple was accused of acting as unregistered brokers of digital currency tokens, while a similar complaint was filed against Coinbase in 2023. Both companies deny the allegations.

Trump’s shift from crypto skeptic to supporter has resonated within the cryptocurrency community, which views his stance as a potential remedy to the regulatory challenges posed by Gensler’s SEC. This change in attitude is winning Trump backing from a vocal segment of the crypto world.

In recent discussions, crypto investors have floated names for potential SEC commissioners under a Trump administration. Candidates include former Commodity Futures Trading Commission chairs J. Christopher Giancarlo and Heath Tarbert, as well as Dan Gallagher, a former SEC commissioner during the Obama administration, and Paul Atkins, who served under President George W. Bush.

Gallagher expressed his honor at being considered for the role, emphasizing his dedication to fostering market access and financial innovation. Atkins, involved in shaping Trump’s previous financial regulatory policies, remained noncommittal about a potential return.

Beyond the SEC, a Trump administration could see former officials now lobbying for the crypto industry filling key positions at the Commodity Futures Trading Commission and the Federal Trade Commission, influencing future crypto regulations.

On the Democratic side, concerns are growing about the perception of President Joe Biden’s administration being anti-crypto. Gary Gensler, appointed by Biden, has maintained a critical stance on digital currencies, which some believe could push crypto supporters towards Trump.

In response, venture capitalist John Doerr hosted a meeting with White House Chief of Staff Jeff Zients, attended by over a dozen crypto enthusiasts. They argued for a more balanced approach to crypto policy, cautioning that Gensler’s remarks could alienate crypto investors.

As the political battle over crypto regulation intensifies, the community finds itself at a crossroads, with significant implications for the future of digital assets in the United States. The upcoming election could be pivotal in determining the regulatory landscape for cryptocurrencies, making the stakes higher than ever for both sides.

Financial Desk

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