Outcome Will Decide the Future of Crypto Legislation

The US midterm elections are underway, and the outcome could have a larger impact on the future of crypto regulation than most people believe.

Polling so far in the election has indicated a clear lead to the Republican Party for the House of Representatives, while the Senate is a bit more uncertain. If the Republicans can secure a majority in the House and the Senate, the US could be facing more political gridlock over the coming years given that the White House remains under Democratic control for at least another two years.

For crypto, the election matters given important regulatory matters on the government’s agenda. According to a recent Bloomberg report, the crypto industry had widely expected 2022 to be the year when regulatory clarity could finally arrive, or that lawmakers – at the very least – would come up with a plan to regulate crypto.

With only two months left of the year, however, the chances that any crypto-related bills will be passed by Congress appear very slim, the report pointed out. Still, it’s not all bad for the crypto industry, where the general sentiment is that Republicans are expressing more favorable views than their Democratic colleagues.

For instance, one of the most notable crypto critics in the House is Democratic Representative Brad Sherman, who first became known in the crypto community in 2019 when he proposed a ban on cryptoasset purchases in the US. The Congressman followed up with more sarcastic remarks on crypto during a hearing in December last year, when he suggested that “bitcoin could be displaced by ether” and various obscure altcoins he referred to as “hamster coin” and “mongoose coin.”

Moreover, it is believed that a Republican-controlled Congress would push more aggressively to pass bills that the crypto industry is asking for. Additionally, Bloomberg also noted that Republicans are likely to put pressure on regulators like the SEC to ease their aggressive stance towards the crypto industry.

Commenting to Bloomberg on the regulatory outlook for crypto if the US ends up with a divided government after the election, Mike Conaway, a former chairman of the House Agriculture Committee who now lobbies on behalf of the crypto industry, said he remains hopeful.

“So far, most things crypto have remained relatively bipartisan,” Conway said, while adding that passing crypto legislation would be an “easy victory” for the White House and Congress. At the same time, it would make it clear for everyone that Democrats and Republicans can still work together, he said.

As of press time at 21:00 UTC, the latest polling still indicated a Republican win in the House, while the Senate remained a toss-up, according to Politico. The outlet also said that Republicans “oozed with confidence” on Election Day that their party is “on track to claim majorities in both houses of Congress.”