Cryptocurrency is popular and lawmakers are taking note

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With the Republican Party solidifying its ticket for the presidential race with the addition of JD Vance, there is one more pro-crypto politician eyeing the White House in 2024. In addition to another pro-crypto individual entering the race, the SEC is inching closer to authorizing spot ether ETF products, which would represent another large-scale shift in the crypto landscape in 2024. Highlighting this pivot and change in attitude are recent comments from the head of Blackrock Larry Finkwho commented that his previous statements about bitcoin were incorrect and that bitcoin provides important diversification for asset managers. Notably, it also appears that real world asset tokenization – which Blackrock did bold predictions about – is outperforming other crypto assets in 2024 so far.

With this increase in positive momentum and sentiment, it seems that crypto investors and advocates can rest assured that the crypto market is in good hands. As tempting as this may seem, however, it is always important to have reasonable expectations, realistic plans, and logical methods to achieve these desired outcomes. Given that crypto continues to gain prominence on both sides of the aisle, and looks set to be at least part of the conversation as the race for the White House heats up, what are some bucket list items to keep in mind?

Stablecoin Policy

A long-awaited and discussed goal within the crypto community has been some sort of comprehensive policy or legislation around stable coinswhich makes sense from a number of perspectives. First, stablecoins provide a more easily understood on-ramp through lower volatility and connections to TradFi assets for individuals and institutions looking to gain exposure to crypto assets than other options. Second, TradFi companies have readily embraced stablecoins, with several companies having issued native stablecoins. Finally, this is an area that makes sense from a banking perspective as well, given the implications of stablecoin transactions.

Given that the US dollar is being challenged in its role as the global reserve currency by several nations, that tokenized transactions are cheaper and faster compared to existing options, and that the vast majority Stablecoins are backed 1:1 by the US dollar. Stablecoin policy makes sense from all perspectives. Establishing a solid policy in this space would benefit all investors and advocates in the space.

Bitcoin Policy

One wish list item that may be less possible in the near term is the establishment of a strategic U.S. policy on bitcoin. With nations like El Salvador Having several years of head start in this area, and deciding to physically store private keys to state-owned bitcoin holdings within the nation’s borders, there is precedent for the U.S. to develop and enact similar policies. Similar to how private corporations diversify asset holdings, establish and maintain diverse revenue streams, and allocate funds for future possibilities, nation-states have similar responsibilities.

With supporters Like Senator Lummis (R-WY), the potential for—if not a strategic bitcoin reserve—at least a strategic bitcoin policy is something that should be on every crypto advocate and investor’s wish list. Even the process of having the conversations and making the investments necessary to enact such a reserve or policy would accelerate broader policy discussions around crypto, tokenization, and the digitization of financial services.

Bitcoin may not have succeeded as the global reserve currency of the future, but it still has an important role to play in cryptocurrency policy and investment and will shape the future.

Renewable Energy Policy and Cryptography

Labeling this item a wish list item may seem like an interesting choice, as it combines two of the most hotly debated topics—bitcoin and renewable energy—into one option. Setting aside some of the rhetoric reveals that these two concepts are not as far apart as they may initially seem, and could actually help each other grow. Renewable energy, or non-fossil fuel energy sources, are already a political priority in the United States, and that seems unlikely to change any time soon. Even short-term divestments or new investments in fossil fuel production seem more like near-term events than major policy changes.

Cryptoassets, but especially bitcoin, have a documented history of not only using non-fossil fuel energy resources, and serving as a grid management tool during periods of higher than anticipated demand. As demand for electricity continues to increase, due to a number of different industries and commercial applications using AIThe focus on real-time, responsible and effective grid management should only become more of a priority. Since crypto operations already tend to be green, it makes political sense to look at how these two areas can work together.

Cryptocurrencies are coming to Washington in a big way, which could pave the way for some of these wish list items to become a reality.

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