As Biden wins the election to become the 46th president of the United States of America, it’s worth looking into what the Biden-themed presidency will mean for cryptocurrencies, blockchain and Bitcoin. We’ve listed out the possible for-or-against possibilities that Biden brings to the table below, as we contemplate what does Biden’s win mean for Bitcoin and cryptocurrencies.
- Biden’s second highest donor after New York Mayor Michael Bloomberg is Samuel Bankman-Fried, the CEO of cryptocurrency derivatives platform FTX.
FTX has been one of the biggest and most successful securities and derivatives exchanges in crypto. Bankman-Fried’s donation isn’t only a huge press play for cryptocurrencies; he’s a member of the wealthiest Democratic super PAC “Future Forward”. It’s the no. 6 outside group by total election spending, and a huge portion of its funding comes from some of Silicon Valley’s biggest names. Facebook co-founder Dustin Moskovitz contributed $22 million to the Super PAC alone; other huge names include Eric Schmidt, the former chief executive of Google; Kathryn Murdoch, of the Murdoch family; and Patty Quillin, the wife of Netflix co-founder Reed Hastings.
However, Bankman-Fried’s donation is the largest single individual donation made. Given America’s history of policies heavily dictated by industry lobbying, it’s likely that Biden will take a pro-technology and pro-cryptocurrency approach.
- Biden’s running mate, Kamala Harris, has tech wizard Ryan Montoya on her team.
Ryan Montoya, better known as the former Chief Technology Officer of the Sacramento Kings, has been heavily pushing for cryptocurrency and blockchain adoption with real world use cases.
The Sacramento Kings have been accepting Bitcoin for payment as early as 2014, being the first NBA team to do so, and was named as the “Most Innovative Company in Sports” by business magazine Fast Company.
The Kings have launched blockchain-based tokens for their fans, mined cryptocurrencies, and even auctioned off game-worn jerseys through an auction held on the Ethereum blockchain, done in collaboration with ConsenSys.
Montoya was also an associate to the President’s Office during Obama’s time, where Biden was Vice President, making it highly likely that they will continue working together through Biden’s presidency.
- Biden’s 2020 presidential campaign includes Andrew Yang on its small business advisory council.
Andrew Yang, one of the former presidential hopefuls in the election race, is well known to have covered the need for leniency in cryptocurrency regulation and blockchain innovation in his campaign trail. He’s been invited to be a part of Biden’s campaign team, and has in the past proposed implementing a blockchain-based voting system if he was elected president.
Yang’s involvement with Biden’s campaign means that there is a huge possibility he could be part of the administration, which would put him in a powerful position to promote and bring awareness to blockchain technologies and cryptocurrencies.
- Biden’s last moments in the presidential race were marked by a huge increase in Bitcoin’s price.
As the votes were being tallied, Bitcoin saw a bullish move up to over $15,600 – a 17% increase from a week before, with similar trends in Ethereum. Sentiment in the market seemed to be highly positive in light of Biden’s likely appointment as President, and it could very well signal that the Biden administration is being received positively by the cryptocurrency community in general.
- Biden has never openly mentioned or talked about cryptocurrencies, blockchain or Bitcoin, except when his Twitter account was hacked.
Blockchain and cryptocurrencies don’t seem to be a huge priority on his campaign, as he has not taken any stance or sides on the issue, nor has the topic been brought up in his campaign or in passing.
While this may not necessarily be a bad thing for cryptocurrencies (regulatory attention is sometimes unwanted, especially given the movement towards decentralization that is so antithetical to governments), it’s clear that there is a long way to go before we can see the direction a Biden administration would take.
His one mention of cryptocurrencies and Bitcoin was to request for campaign donations as a response to the Twitter hack – although the donation link ironically did not include any option to contribute in Bitcoin.
- Biden’s capital gains tax plans are not beneficial for cryptocurrency profits.
Biden has campaigned to have capital gains taxes raised from 21% to 39.6% for certain income brackets, a move which contrasts Trump’s intention to lower long-term capital gains down to 15%. The move, expected to be applied to income brackets around the $400k to $1M range, is highly likely to affect Bitcoin-related wealth – as long-term capital gains would typically cover.
It could also trigger a large sell-off for Bitcoin, as the last time capital gains taxes were increased in 2013, the markets saw a $100 billion stock sell-off. Compared to then, when Bitcoin was worth $1,000 at its peak, today’s Bitcoin has a place amongst the top 25 largest companies and assets by market cap, ahead of giant tech companies such as Disney, Netflix, Verizon, Paypal, and even the Bank of America. This makes it possible that a capital gains tax increase would lead to a sell-off and drop in Bitcoin prices.
What Does Biden’s Win Mean For Bitcoin And Cryptocurrencies?
As Biden seals his fate and is officially inaugurated on 20 January, 2021, it seems that he could have a positive effect on the adoption of both cryptocurrencies and blockchain technology. Based on the findings above, the President-elect and his supporting team have plenty of interest, and fingers, in the cryptocurrency pie. Stay tuned for the latest market trends as they’re released at Oobit. Oobit is a financial service that makes buying and selling digital currency easy, simple and lets you use crypto with the same ease as traditional money. We connect and introduce what would be an endless maze of information surrounding blockchains, and build tools that enhance the crypto user experience.