By Stephanie Kelly, Suzanne McGee and Hannah Lang
NASHVILLE (Reuters) – Republican Party candidate and former U.S. President Donald Trump once criticized cryptocurrency, calling it a “scam.” Now he’s the star of one of the industry’s biggest conferences.
Trump, who made the comments in 2021, will deliver a speech Saturday, the final day of the three-day 2024 convention in Nashville. Also scheduled to speak are independent U.S. presidential candidate Robert F. Kennedy Jr., former Republican candidate Vivek Ramaswamy, Sen. Bill Hagerty of Tennessee and Sen. Cynthia Lummis of Wyoming.
Among the Democrats is U.S. Rep. Ro Khanna of California.
The industry quickly rebounded after the collapse of FTX and a number of other cryptocurrency firms in 2022, which caused token prices to fall and forced many companies into bankruptcy. Advocates for the digital asset say cryptocurrency users are becoming a growing political force this election cycle, although it’s unclear how many users would put cryptocurrencies above other issues in a vote.
The Republican Party is courting their votes by promising lighter regulations, potentially tying a currency created to bypass the government to a major American political party.
“For most of its history, cryptocurrencies have been a largely unbiased issue,” said David Yermack, a professor at New York University’s Stern School of Business, because neither Republicans nor Democrats understood cryptocurrencies or wanted to learn more about them.
“I think Republicans have started to move a little faster in that area over the last year or two.”
Stand With Crypto, a nonprofit industry group backed by cryptocurrency exchange Coinbase (NASDAQ:), has organized more than 1.3 million supporters. Meanwhile, three major pro-crypto political action super committees — Fairshake, Defend American Jobs and Protect Progress, which didn’t exist until this cycle — have raised more than $230 million to support amiable candidates.
That influence is already being felt. Fairshake, a super PAC that promotes pro-crypto candidates, spent more than $10 million this year on California progressive Democrat Katie Porter’s Senate bid. Porter, who has questioned the impact of bitcoin mining on climate change, lost her primary.
Some cryptocurrency advocates are backing Trump, including the billionaire Winklevoss twins, who founded cryptocurrency firm Gemini. They each gave him $1 million in bitcoin but had to take it back because it exceeded the maximum amount allowed under federal law.
In 2023, 7% of U.S. adults held or used cryptocurrencies, the Federal Reserve reported in May, down 3 percentage points from 2022 and down 5 percentage points from 2021.
“It’s pretty clear that the industry wants to bribe as many politicians as possible to hijack the agenda and put the American people’s interests first,” said Dennis Kelleher, CEO of Washington-based advocacy group Better Markets.
“Of course, their particular interest is in little or no regulation,” he added.
However, the annual convention attracts more politicians than ever before.
“There’s a joke that the speakers’ list looks like RNC Lite,” one attendee said in an interview, referring to the Republican National Convention in Milwaukee in mid-July.
TRUMP’S NEW EMBRACE
Trump’s appearance at Bitcoin 2024 is his latest show of support for the industry. At a June fundraiser in San Francisco, he criticized Democratic attempts to regulate the sector. Last month, he met with bitcoin mining companies at his Mar-a-Lago resort.
“We tried to reach out to the Biden administration, but unfortunately they weren’t receptive,” said Jayson Browder, head of public policy at Marathon Digital (NASDAQ:) Holdings, who attended the Mar-a-Lago meeting. “And former President Trump was more than receptive and is now actively supporting our industry.”
Trump recently made it clear that he would like US companies to augment their bitcoin mining.
Cryptocurrency company executives are outraged by enforcement actions by the Securities and Exchange Commission under U.S. President Joe Biden.
The agency alleges that several cryptocurrency firms, including Coinbase and Binance, allow trading of digital assets on their platform that should be registered as securities, which the companies deny.
The White House told Reuters that the Biden-Harris administration will continue to meet with stakeholders and work with Congress to develop the necessary safeguards to leverage the potential benefits and opportunities of crypto-asset innovation.
Vice President Kamala Harris is likely to support Biden’s cryptocurrency policies if he wins the presidential election in November.
Neither Trump nor Harris campaign officials immediately commented on the article.
Investors betting on a second Trump presidency are massively investing in asset classes that are likely to appreciate under his administration.
Cryptocurrencies, and bitcoin in particular, are “by far the cleanest, most direct way to play Trump’s trade,” said Cameron Dawson, chief investment officer at NewEdge Wealth.
Conference attendee Hillary Adler, who co-created the BitcoinOS operating system, previously voted Democratic but now describes herself as a left-libertarian. Calling herself an undecided voter, Adler said she’s not surprised some Republican politicians have switched to supporting cryptocurrencies.
“Republicans have always been better at long-tail strategies, politically,” she said. “Now they’re interested in crypto.”
