Unchained - It’s Not Just the Presidency. Congressional Races Matter a Lot for Crypto - Ep. 726

Starting point is 00:00:00 This really is the most important election. Like, we are going to have this opportunity, we think, to go in and get legislation done so we can stop the regulatory challenges and have a pathway forward. Hi, everyone. Welcome to Unchained, your no-hife resource for all things crypto. I'm your host, Laura Shin, author of The Cryptopians. I started covering crypto nine years ago and as a senior editor of Forbes was the first mainstream reader-reporter, to cover cryptocurrency full-time. This is the October 29th, 2024 episode of Unchained.

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Starting point is 00:01:44 Welcome, Kristen and Alex. It's great to be here, Laura. Thanks for having us, Laura. It's great to be with Kristen. We spend a lot of time together, so it's always a pleasure to meet again over Zoom. We're in the last week before the election, and while the crypto community has been paying close attention to the presidential race, there's been a whole host of other contests that could also affect crypto. Before we dive into the specifics on these various races, let's also just talk

Starting point is 00:02:09 generally about the importance of Congress for crypto. In this particular election, what would you say is at stake for the industry? What could the industry get or not get, depending on how these races go? And Kristen, why don't we start with you? Yeah, no, Laura, you're absolutely right. This election is incredibly important for crypto. I mean, I think, as you know, and we've been talking about for years, over the past three and a half years, particularly with the SEC, the crypto industry has just faced an unprecedented level of hostility. And I think we've finally turned the corner towards that hostility and are now entering a friendlier phase. I think we made a lot of progress this year with Congress and thinking about market structure legislation

Starting point is 00:02:54 and stable coin legislation. And I think when the new Congress comes in next year, we'll be able to get that framework into place so that we no longer have to deal with the regulation by enforcement approach that we've been having to deal with over the past couple of years. Oh, that's great. Yeah, I know the industry obviously would very much welcome that. And Alex, what do you think? You know, what would you say is the import of these different congressional races? So first off, I would just like to start by saying that any partisan views that I may express today are my own personal ones and not necessarily the views of paradigm I grew up in kind of Republican politics and I've worked for Speaker of the House, John Boehner on the Hill, in financial policy and crypto policy since.

Starting point is 00:03:38 But we have both strong Republicans and Democrats at paradigm. And so we try to dig really, really far into all the legislation, all of these races on both sides of the aisle. Kristen nails it, I think. This is going to be the most pro-crypto Congress that we have ever had this coming Congress. I mean, it's pretty undeniable the impact that the industry has had this cycle, not just the races that the super PACs have been spending in, but also some of the kind of more underreported ones in safe blue or red seats. I think a couple good examples, Sam Lickardo, who's running for Congress in California. He's the former mayor of San Jose, and he was actually the one who integrated helium's decentralized wireless into the city. for free wireless for everyone. On the other side of the aisle, Riley Moore, who's in West Virginia,

Starting point is 00:04:32 he's current state treasurer. He oversaw a bunch of coal mines being repurposed for Bitcoin mining. So it's pretty clear that just across the board, crypto has grown, crypto's influence has grown, and there are more pro-crypto candidates running that will be in Congress next year than ever before. Yeah, I mean, I did want to touch on this because I am sure you guys have seen the coverage, A lot of people are making, you know, hey of the fact that, I guess, the biggest financial influence in this election has been crypto money. And, you know, some view that as negatively because it's not always disclosed. But then obviously it is having this effect. So, yeah, just what are you seeing in terms of like the reactions to that?

Starting point is 00:05:20 Yeah, no, this has been, this is a bazooka. We have the world's largest super PAC. right? This is not a normal tool that industries have, and crypto has decided to go all in on this. So I would love to take a few minutes to talk about TherShake, the Super PAC that is funded by the crypto industry and just sort of talk about what it's doing. I think Alex kind of alluded to some of the new sort of bipartisan group of members that we're going to have coming into Congress. But Fershake has played a huge role in this. I do want to say I don't control the Fershake Pack. The Fershake Pack wasn't my idea. But as somebody who represents the industry in Washington, that presence of the super PAC is very much noticed by offices on Capitol Hill.

Starting point is 00:06:07 And the crypto money is a big part of the conversation. And members of Congress who have to run for re-election and it's expensive to do that. And there's always third party influencers coming in. They're very interested in understanding who the people are in the crypto space, how they can get to know about it better. because they see this as something that could be very helpful to them or very hurtful to them if they're against crypto. And so we're at a level of discussion that I've never seen as an industry in Washington right now because of it.

Starting point is 00:06:42 But I think what's been really interesting about Fairshake is they've done some non-traditional things. I mean, first, it's a very large-sized pack, right? And it is all fully disclosed. There's a lot of money in campaigns that happen through these, organizations that are that are much less disclosure but this is like out in the open you know who contributed money going into the pack you also know where all of those contributions are going to it's all publicly disclosed and I think what what they did was interesting is they looked at

Starting point is 00:07:15 these sort of open seats like Alex was saying these are these are districts that were the current congressman has retired and stepped away and there was going to be somebody new coming in And what they did is they often played in the primaries, which usually you don't have third party money coming in to primary elections because people don't want to, you know, help pick the winner or loser. But what crypto did is they help pick the winner or loser. And now those winners are, you know, very grateful for having that sort of help early on in the process. Then what Fairshake has done in the general elections and I guess in the primaries as well is they have helped, candidates who have been very pro-crypto in Congress. They have said, hey, we have these leaders and key committees who have been very helpful, who have taken time to get to know this space, and they have gone in and supported their campaigns. I think most notably what the PAC is

Starting point is 00:08:11 they have gone after candidates who have been very anti-crypto. So I think most notably, Sherrod Brown, who is the current sitting chairman of the Senate Banking Committee, fair shake is spending about $40 million in favor of his opponent in an effort to unseat him. So these are obviously really, really big bets. But I think it's a very aggressive strategy. It's very different. I don't think most industries would have the stomach or the appetite for this level. And I think what ultimately will happen is that crypto will be taken seriously.

Starting point is 00:08:48 We will no longer be sort of cast aside or told that, oh, the agency, these already have authority. You know, people will look at us and say, all right, let's have a real conversation because, you know, you're playing at a very high level and you're here to make sure that you get the framework you need and you're, you know, willing to play the game to do it. So I'm excited about it because it makes my job easier. Again, I don't control it, but it's been a very, very aggressive strategy. And how much have they spent on this election so far? About $170 million. Okay. And just for context, like what is the second largest amount or like what's a typical amount that an industry would spend?

Starting point is 00:09:30 So there aren't really typical industry super PACs. I think the most comparable big effort is probably APAC, which is the pro-Israel pack. But yeah, as Kristen said, we are the single largest non-presidential super PAC. So like the Donald Trump super PAC and the Kamala Harris super PAC are quite large. but ours is entirely focused on congressional races and quite sizable. So I imagine, like, basically, people are paying attention because of the money. But is there a sense of, I guess, so like, you probably saw the New York article about a fair shake. And there was a sense that the article kind of was trying to imply that, I don't know if, like, the word unfair, but just that these industries are like spending, you know, just huge amounts to sway these elections. And like they're not always, like, I guess so for a lot of these ads, it's not totally clear who is running the ad. Like, for instance, one of the Fair Shake affiliates is just called Defend American Jobs.

Starting point is 00:10:38 So do you sense, like, is there like any backlash to this amount of money coming from this industry? Or do you really feel like it's just, it's just allowing, you know, it's making people more open-minded. Because I could see it either way, I could see it being people just being pragmatic and being like, okay, we have to deal with these groups that have a lot of money. And then other people might say, whoa, this is kind of just beyond the typical. And they're trying to like use money to get things that are maybe not like exactly what the electorate wants. I mean, look, I think that this has allowed the industry to have its voice heard in Washington in a pretty like incontrovertible way. So it's very easy to read whatever kind of policy news outlet in D.C. over the past couple of years and read a bunch of anti-crypto things.

Starting point is 00:11:31 And if you're members of Congress have to deal with a huge variety of issues on any given day and their staffers, no different. It's really easy to just read the news and say, oh, well, crypto doesn't seem like something we need to care about. So I'm content to either not care or be actively against it. And this has kind of broken through that logjam where members have had to say, you know what, I'm going to take the time to dig in. And oftentimes what they find is a lot to like. Democrats like how it expands access to financial services. Republicans like the kind of censorship resistance and individual financial liberty angle. Crypto is a nonpartisan technology. And so this has been like a very, very useful tool to have our voice heard. Yeah. And I would say it's been really interesting too because, you know, in past campaign cycles, we didn't have candidates who were running for Congress for the first time, call us up on our main number at the blockchain association and said, hey, I'd like to learn around about crypto. Like, that never, ever happened. This year, we've had one, maybe two candidates a week who are coming by that want to sit down. Alex will come sometimes. We'll pull in other people from the industry. We'll just have a conversation about, hey, this is what we're building. This is what we're doing. And this kind of outwe're reach from candidates and existing members of commerce as well. It's not, it's not happened at this level before. We've always had to be the ones kind of pushing to go meet with people. And now it's

Starting point is 00:12:58 completely reversed and it's the other way around. And so it's been just a really huge opportunity to do that kind of education. Again, we're not even to the policy issues with these folks yet, right? We're just trying to let them know why we're excited about crypto, what the industry is building and, you know, let them know that there's, it's important to keep this here in the United States at the very highest level. And it's wonderful to have these conversations with these candidates before they get to Congress, as opposed to having them get there and then, you know, taking several years before we get to them. And especially, like, as we saw this year, we actually are having votes on the floor of the House and the Senate on these issues. And so it's not just the committees

Starting point is 00:13:39 of jurisdiction that are thinking about this now. It's like the whole of Congress. And we have, a really good head start with this new Congress in terms of having a more educated Congress to work with. Yeah, I could see all of that being beneficial. And one other thing I wanted to ask was in that article, they seem to imply that both Democrats and Republicans are getting very upset because. No, yes. I mean, listen, I think at the end of the day, we will look back on this and be like, oh, yeah, there were a few people that were upset. But the bigger picture is that, you know, you want. want to, you know, you want to talk to crypto, you want to be with crypto. I think, yeah, if you're Sherrod Brown and you're having $40 million spent for your opponent, of course you're

Starting point is 00:14:25 upset, right? And at the primary level, it's a little bit different because you're usually supporting a Republican versus a Republican or Democrat versus Democrat. You know, there's a lot at stake here. And the reality is that this matters and that, you know, there are consequences is to the decisions crypto are making. So I think, you know, we'll have to see how everything shakes out on election night and to want to know if this is going to work or not. But, yeah, I think it's because it may matter. But I don't know, Alex may have other thoughts.

Starting point is 00:14:56 Yeah, I think Paul Graywall was in an interview over the weekend, to say it's a CLO, and I think put it really well, which is, look, win, lose, or draw, no matter what crypto has won this election, there's going to be people who are mad at anything that you do in Washington, D.C. Deal making, if both sides are upset, that means that it's a pretty good deal. I think running for Congress and getting your issues and your voice is heard is similar. We're making plenty of friends. You're going to make maybe a couple of enemies along the way. But I can't tell you how many members of Congress or candidates that I have talked to who are so grateful for the crypto industry for paying attention to their race and supporting them, whether that was a super PAC, whether that was executives, just taking the time. to meet. The industry has gotten so invested in the outcome of our democratic process. It's pretty remarkable. I think for the most part, Silicon Valley likes to say that it's across the country and D.C. should stay out of its business. And crypto, I think, learned a very hard lesson back in 2021 with the

Starting point is 00:16:02 passage of the Infrastructure Act and the inclusion of the broker reporting rule that you can't ignore DC because sooner or later it comes knocking on your door. So we've fully learned our lesson. We've dove in. Yeah. Yeah. I mean, yeah, it was interesting because just from the way that they described it, it definitely seems like the initial approach was, we'll be bipartisan. We'll just support whoever on either side is pro-crypto. But then, yeah, that ended up resulting in both sides getting very mad when their own members were being targeted. So before, so before we, we dive into like all these different races. Let's just talk about which committees and subcommittees are important for crypto and why. So just do a quick rundown of like which ones you guys are,

Starting point is 00:16:49 you know, typically pay attention to and what area of crypto policy they have an impact on. Sure. So there's kind of four key committees and there's a few kind of lesser but still important committees. The four key ones are the two financial services committees. So the Senate Banking Committee in the Senate and the House Financial Services Committee and the House. They oversee the SEC, all of the prudential regulators, so the OCC, the FDIC, and the Federal Reserve, the bank regulators. And then the House and Senate Agriculture committees oversee the Commodity Futures Trading Commission because ultimately it was commodity futures that kind of give rise to that agency.

Starting point is 00:17:27 So it's interesting because on the one hand, you have two committees where all the members there know that they're here to work on financial services issues. And on the ag committees, you have a bunch of members. who join for agricultural issues. Some join because, I don't know, they're from Chicago and derivatives are right in their backyard. And some of them join because they have dairy farmers in their district and they care a whole lot about them. So there's a very interesting kind of divide between the two. And those are the four committees that I would say Kristen and I spend the majority of our time with. One step down from there is probably the House Energy and Commerce Committee and the Senate Commerce

Starting point is 00:18:02 Committee, which have oversight over kind of like more broad technology issues. So all of the kind of platform, big tech issues, telecom networks, energy, the FTC. So like NFTs kind of reside over at those two committees. And I think next Congress will probably see both of them dig in a little bit more and get more involved. And the last two committees are always important, but don't get a ton of attention. And that's the two tax writing committees. So in the Senate, that's the Senate Finance Committee and the House, that's the House Ways and Means Committee. And next year, is the expiry of the 2017 tax cuts and jobs act. So next year is like tax Super Bowl.

Starting point is 00:18:44 So regardless of what happens at kind of the top of the ticket, there's going to be some big tax fight. And crypto is probably going to have a role to play there as we try to keep ourselves, I guess, off the menu to use DC parlance and to also try and get some tweaks around the edges that could have really important and impactful outcomes for the industry. Okay, so one other thing I think the audience should know before we dive into each of these different races and the different committees is, as far as I understand, there's a difference in the way Democrats determine committee chairmanship and how Republicans do. So, Kristen, can you explain that?

Starting point is 00:19:24 Yeah, and Alex, feel free to add anything I miss here. But yeah, Democrats tend to do a seniority system. And so what often happens is they go to the person who's been serving on the committee the most. They give that person the chair position and that, you know, person would hold that seat for as long as they want. So, like, for example, if we're looking at Maxine Waters, who's currently the ranking member on the Democratic side, she will likely continue to be the chair and she will do so for as long as she serves in Congress. Republicans tend to do it differently. They usually have, often there's like a race between some of the more senior ones and they end up selecting who will be the chair. So, for example, with Patrick McKenry, it's unclear who's going to replace him as the Republican

Starting point is 00:20:10 lead on the House Financial Services Committee. But whoever does get that position will only hold it for six years. And so, you know, there's sort of term limits and Republicans tend to cycle through. But Alex, feel free to add anything I missed. Yeah. It's interesting. On the House side, yeah, on the Republican side, you kind of have this horse race where you've got kind of a meritocratic process every, chair, hopeful, comes in, gives their pitch to the steering committee, which is this kind of

Starting point is 00:20:40 secretive body that oversees who gets named chair of each committee. And like, you're, you're fundraising for your colleagues, how much you campaigned around the country to help your colleagues get elected, all factors into this process. All of the different candidates who are running for, to be McHenry successor are all relatively pro-Crypto. Congressman French Hill was one of the lead authors of Fit 21 and actually was recently, the news because he helped secure the release of Tikrit and Gabarian from Binance, who has held captive in Nigeria, I think. Andy Barr is one of the other lead candidates. He's been really dug into kind of the financial institutions angle of crypto, so he's really interested in stable coin issuance

Starting point is 00:21:22 and cutting down payment transaction costs and the like. And then Bill Heisenga, who's been on the committee for quite a long time, has overseen the cap market subcommittee and overseeing the SEC. and then Frank Lucas, who actually has chaired the Ag Committee, too. So he's seen that kind of break between how the SEC and the CFTC overlap and how they fight and how they disagree about who regulates what. So there are no real bad outcomes for crypto. Losing Chairman McHenry is obviously a loss because of how much he's prioritized or industry. But anyone who replaces him will be able to work with.

Starting point is 00:21:58 On the Senate side, I think it's important to point out that the outcome of who, controls what chamber has a huge impact on who chairs the committee. So right now, Democrats control the Senate and Sherrod Brown is the chair of the Senate Banking Committee. It is more likely than not. And we can get into why a little bit more in a second. But Republicans are most likely going to control the Senate, which means that Senator Tim Scott of South Carolina is the most likely candidate to chair the Senate Banking Committee. And he has said that he wants to create a digital asset subcommittee to specifically focus on crypto issues. So on both sides of Capitol Hill, on both sides of the aisle, we're making a ton of forward progress.

Starting point is 00:22:46 Yeah. So now we're getting into kind of like the different committees. But yeah, why don't we start with that Senate banking one? Because obviously Sherrod Brown is that's the race that Fairshake has by far spent the most of its funds on. I saw a graph. And, you know, the amount that was spent on him was like all the way out to here. And then all the others were like close to the X-axis. So yeah, it just was pretty stark. They obviously are focusing most of their firepower on that race. Talk a little bit about why that particular race is so important to crypto. Yeah. Well, I'll maybe start in an Alex handed over to you. But so first of all, Ohio is a swing state. And so it's one of the handful of Senate races that have the opportunity to

Starting point is 00:23:37 switch from Democrat and go to Republican. I think, you know, to step back at a high level, the Senate has a unique role to play for the crypto industry. One, our greatest enemy, Elizabeth Warren, sits in the Senate and she sits on the Senate Banking Committee. And so, you know, if the Democrats are in power, she has more power. So this is one of the cases where, yes, crypto is bipartisan, but having a Republican Senate will help us with Elizabeth Warren. The other unique power that the Senate has that the House doesn't have is that they confirm nominees to the agency. So the president will nominate someone and then the Senate Banking Committee will hold a hearing, approve them, and the full Senate floor will take a vote as well. And so, you know, having a

Starting point is 00:24:26 Republican Senate would probably ensure that somebody like Gary Gensler doesn't get back into the administration as Treasury Secretary or as, you know, continuing at the SEC. And so as you look across the Senate races, you have to remember only a third of the Senate is up every two years. They have six-year terms. Ohio is one of those states where there is an opportunity to make a change. And it's also dealing with somebody who's been in this position of power where he could have stepped up to help the industry and didn't. And so it is, again, this is a pretty aggressive bet. I don't think most industries would, you know, go after and target the sort of sitting chair of a committee. But this is this is what I guess we're doing as the crypto industry. But Alex has,

Starting point is 00:25:13 I'm sure, other things to add. Yeah, I think this is a particularly difficult call that the folks who are making decisions over at Fair Shake made. I think generally speaking, when Chris and I and our colleagues in the policy community go up to the hill. We try to assume that there isn't necessarily like malice on the other side of the desk. Maybe there's just a lack of understanding. Maybe someone's misinformed. If we talk to them and we explain crypto, we explain our issues, eventually it might take some time, but eventually they'll see things our way and understand why this is truly the future of finance and the internet. Sherrod Brown, I think, is a unique example of someone who I think has had plenty of those conversations, and to date has yet to show any interest

Starting point is 00:25:58 in leaning in. He is a friend and I think ideological ally of SEC Chair Gary Gensler and also of Senator Elizabeth Warren. They have a lot of kind of staff in common, and he's certainly been an obstacle, as Kristen has said, to progress. So that's kind of like the one. And then you look at the split screen of who the guy running against him is. And this is, and this is, is a gentleman by the name of Bernie Moreno. And Bernie built a career, a kind of building car dealership network across the country. And back in 2018, he decided to use his experience in kind of car titling and everything and decided to start a company called Champ Titles that actually brings car titles on chain to show provenance and ownership. He also started, I think,

Starting point is 00:26:52 a crypto incubator in Cleveland to kind of foster a nascent crypto community there. So on the one hand, you have a guy who's been uniquely unhelpful. And on the other hand, you literally have a crypto founder. And so it's a pretty stark contrast. And so the industry decided that a change maybe would be positive. And I think, I mean, it's important to look at polling and see what's happening. I mean, Sherrod is a, I think, 12-year incumbent. He has-17-year-old. and coming. He has an extraordinary ground game. He has amazing constituent services. If you listen to Bernie Moreno, talk about Sherrod. He acknowledges it. He's like, look, like, you could have a Dide in the wool Republican who gets into the ballot box and says, you know what? I'm a Republican. But Sherrod Brown

Starting point is 00:27:40 was who helped my wife get a passport when we were like trying to get to our kids wedding in Italy, something like that. So he is like a really big kind of machine. in what is a traditionally more red-leaning state. So the expectation is Trump will probably carry the state by seven to eight points. Bernie will run a little bit behind Trump. There will be some ticket splitting, folks who are voting for Trump, folks who vote for Sherrod. Right now, I think the last three sets of polls, morning consult had Bernie up by one.

Starting point is 00:28:16 That was October 15th. Active vote had him up by four, October 20th. and then UGov had Brown up by two, October 21. So there's been a lot of lead changes. It's going to be really tight. The kind of general consensus is if Trump wins the state by eight points or more, he carries Bernie over the hump. This is going to be a really tight election, I think pretty much every single race.

Starting point is 00:28:39 So we'll wait to see what the overall outcome is. Yeah, this was something that we reported on here at Unchained. And when you look at the polling over time, Bernie really came from. far behind and now it's it's really closing the gap you know but i do think it probably has to do with the fair shake money um so one other thing that i wanted to ask about was a part of what we reported on was if brown gets knocked out um because of the seniority process for dems um it actually looks like the next most senior would potentially be elizabeth warren it's like kind of confusing because there's three people, but like one of them is not going to win. One of them, you can't chair more than one committee and they will probably want to do the other one. The last one is not clear because they already chair another committee if they would keep that or want to take the Senate banking. But if they don't want to, then it would be Warren next. Obviously, this only matters if the Democrats keep the Senate or if in two years they retake it. But do you guys have concerns about that?

Starting point is 00:29:44 or? Yeah, I think we'll take things one thing at a time and cross bridges as we come to them. To put a slightly finer point on kind of what you ran through, which is, which is accurate. So Jack Reed has seniority above Warren. He's the current chair of the Senate Armed Services Committee. John Tester is running in Montana of all of the different Senate races that are probably going to break the earliest and most decisively. Montana is probably one of them. So Senate control, you need to have 51 seats, obviously, or 50 plus the White House because the VP is the tie-breaking vote. Joe Manchin and West Virginia retired. Jim Justice, who's a Republican, will win by like 30-odd points. So that's already 50-50. So you need just one more in order to flip Senate control. Right now, Tim Sheehee is running ahead of John Tester in Montana by about five points. Trump will win that state by 15 to 20 points or so. So you even though polls close earlier in Ohio, you might see a clear winner earlier in Montana.

Starting point is 00:30:48 So John Tester gets knocked out, you assume. And then you have Mark Warner, who's the current Senate Intelligence Committee Chair. Warner is, this is kind of an interesting thing. This is why you have to look through all the different political kind of permutations and incentives and whatnot. Warner is up for re-election next cycle. So in 2026, he's going to be running to keep his seat. And typically speaking, it's way easier to raise a bunch of money for your re-election as ranking member of Senate banking than as ranking member of Senate intelligence. So I won't speak for Senator Warner and what he will or won't do, but there's a decent shot that he decides to take the ranking member gavel, which means that Warren is still one seat off.

Starting point is 00:31:36 ultimately if he decides not to, then Warren will extract a pound of flesh on every single deal, but she does make deals, whereas I think Sherrod Brown has just been totally uninterested in engaging. So you'll maybe make more forward progress. There might be some pain along the way, but it'll be at least progress. Yeah, I would also add to, and this kind of goes back to what you're asking at the beginning, Laura, it shows that this really is the most important election. Like we are going to have this opportunity, we think, to go in and get legislation done so we can stop the regulatory challenges and have a pathway forward. And I think that, yeah, I think there's a very strong likelihood.

Starting point is 00:32:20 I think it's well into the 80% odds on polymarket that the Senate is under Republican control. So, I mean, the worst case scenario would be to have Elizabeth for somehow like to lose Sherrod Brown and to lose John Tester and to the Senate. and then lose some Republican seats to the point where the Democrats are in control of the Senate and Elizabeth Warren is in charge, right? Like that is the nightmare scenario. But I think that if she is a ranking member or if she's just on the Democratic side of the committee while they're in the minority, then we can still use this opportunity in the short term to get a bill done. But, you know, at some point she will probably chair that committee. And, you know, we need to try to get all of the work.

Starting point is 00:33:03 we need to get the framework in place before she gets to that position. Yeah. The last thing that I would add to is you have to also understand how Warren exerts power. So Warren back in, I think, the 2020 Democratic primary, when Biden ended up becoming the nominee for the Democratic Party, she was also running for presidents. And she basically cut a deal after she dropped out of the race with Biden. I will throw my support and the support of kind of my progressive coalition behind you in exchange for basically staffing your organization with economic policy staff of kind of my ideological bent.

Starting point is 00:33:40 That was how Biden got over the hump against Bernie Sanders. And we've kind of seen the downstream effects of that. There's actually a really terrific Vox article from a couple weeks ago. I think it's called the rise and fall of like new economic progressivism or something to that effect. And it describes this whole process. So that's how you got kind of Gary Gensler as SEC chair instead of someone who is maybe a little bit less activist. That's how you got Lena Con at the FTC. And that's how, like,

Starting point is 00:34:07 even if you have someone like to say Janet Yellen atop Treasury, the staff below her might have gone through the Elizabeth Warren School of Economics, Wally Adayamo, who's the deputy secretary, the Treasury was the first chief of staff at the CFPB that Elizabeth Warren stood up. So there's this whole kind of constellation of how do you place people around Washington, D.C., that you can then kind of almost have this call and response across town to orchestrate outcomes. You see that a lot when like Treasury writes a letter to the Hill asking for certain authorities that's so that folks on the Hill can then write those authorities for them. Oftentimes the folks on the Hill are who are asking Treasury to write that letter in

Starting point is 00:34:53 order to do that. So if you assume that there is an administration change, if that's a Donald Trump presidency, obviously all of those people are basically gone from governments. If it's a Kamala Harris presidency, there's probably going to be some change at least. Kamala Harris didn't strike that same bargain with Elizabeth Warren that Joe Biden did. So there will be some turnover. It'll be a little bit more gradual and it's hard to say kind of where it all shakes out. But in either outcome, there's at least some hope that Warren might be somewhat less effective in having reach across

Starting point is 00:35:30 town that helps her be more effective on the hill. Okay. All right. So in a moment, we're going to talk about the other various committees that could impact crypto policy, but first a quick word from the sponsors make this show possible. Pocod is the original and largest layer zero blockchain with over 2000 plus developers. And the anticipated Pocodot 2.0 upgrade will be a massive accelerator for the ecosystem, upgrading the infrastructure with eight times higher transaction throughput and twice as fast block times, perfectly tailored core time for the needs of every protocol, trustless bridges internally and into Ethereum, Cosmos Near, Binance Smart Chain, and revised tokenomics and the implementation of a token burn to reduce inflation. Perfect for GameFi and Defi to build,

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Starting point is 00:38:20 So, you know, talk about the game theory. They are like if the Republicans have the House, who might chair. I mean, we actually touched on this slightly. But obviously, I know this one is like there's multiple contenders. And then we can talk about if the Democrats take the House or have the House. Sure. So we talked a little bit about the different contenders for House Management Services Committee chair under a Republican-led House. And I will say, while the Senate, we kind of have a pretty firm idea that it's going to be

Starting point is 00:38:50 Republican. The House is honestly anyone's guess. Tons of razor-thin races with a razor-thin majority to begin with, so really could go in either direction. French Hill, I think, is probably the best known to the crypto community. He, as I mentioned, was one of the lead authors of Fit 21, the big crypto market structure bill and has worked with Chairman McHenry on Stablecoin legislation. He also has been the chair of the Digital Assets Subcommittee. So a lot of the crypto-specific hearings, he's been the guy with the gavel asking all the questions and kind of running herd. Andy Barr might be slightly less known. He has taken kind of a more populist approach to kind of some of his policy, which I think lends itself well to his chances with a Trump White House.

Starting point is 00:39:42 Either of that, honestly, like, there are no bad answers. They're all pretty good answers. They're all great guys who are interested in crypto. and who are interested in getting market structure and stable coins across the finish line. So, I mean, I don't even think that we can pick favorites. They're all great candidates. If House control flips, as Kristen mentioned earlier, Maxine Waters will likely chair the committee again, she has been pretty focused on getting to some sort of deal on stable coins with Chairman McHenry.

Starting point is 00:40:19 there's a chance that gets done before the end of the year during lame duck, which is kind of the weird gray zone after an election, but before all of the new Congress comes in remains to be seen. Ultimately, I think this is why next year and next Congress being the most pro-crypto Congress ever is important, because ultimately chairs will reflect the will, not only if they're voters, but also the will of their conference. And if you have a new majority of your conference that wants to work on crypto issues, if everyone on your committee, except for maybe one or two members says, I want to work on crypto, it's so popular with my constituents, or it's

Starting point is 00:41:03 so important to my state or my district, she's going to sit up and take notice. I think the other piece here, too, is one of the big voices that's been in her staff's ear has been, SEC Chair, Gary Gensler. And if he's not there anymore, then you don't have that kind of countervailing force that's calling in and doing staff briefings before Fit 21 comes up for a vote saying this is the worst thing of all time and will ruin securities law forever. In either outcome, the industry will be able to make progress. It just comes down to how quickly do they prioritize it. Okay. Kristen, do you want to add anything on to about that committee or should we move on to the ad committees? No, we can move on to that.

Starting point is 00:41:46 ag committees. Okay. So the next ones, as we discussed earlier, are Senate Ag, House Ag. Why don't we discuss, I guess, we'll start with Senate. It looks more likely, as you said, that Republicans will take that. Yeah. Well, this one is interesting. Maybe we'll start on the Democratic side. You know, right now we have Debbie Stabenow who has actually been working very diligently, those sort of quietly throughout the summer to come up with new market structure or legislation. It hasn't been released publicly yet, but she's been doing a lot of work on this space. You know, unfortunately, she's actually retiring this year. She represents Michigan, and she's decided that she's moving on.

Starting point is 00:42:29 I think notably Chershake is actually supporting the Democrat in Michigan. Just kind of interesting to note that. But she's going to be gone. So on the Democratic side, the one below her is actually Sherrod Brown. So, again, he's also on the Agriculture Committee. I think if he wins, you would probably want to keep banking over agriculture. And then you have Amy Klobuchar who could potentially step in and take that position. But, you know, she's fairly senior.

Starting point is 00:42:57 So it's a little bit uncertain. You know, notably, Kirsten Gillibrand is on that committee. So she would be obviously an amazing ranking member or our chair of the Agriculture Committee. And so I don't know if there's anything you want to add Alex on the Democratic side. I think the other thing with Gillibrand is she might angle for Democratic Senatorial Campaign Committee chairmanship, which is basically the campaign arm of Senate Dems. So if, say, Republicans have won the Senate, Dems are trying to take it back. A really, really great position to fundraise to kind of bring about that outcome is going to be as a ranking member or chair of Ag. It would be ranking member given that Republicans had won. But yeah, there's a bunch of great members on the Ag. committee. And just because I don't remember if we discussed this earlier. So ag, they would be in charge of CFTC and like what are the other areas of crypto they would affect? Just the CFTC. Oh, okay. So if, yeah, if Congress decides to give the CFTC an expanded role, that authority

Starting point is 00:44:02 would have to come from the Agriculture Committee. Okay. And if Republicans keep this, take the Senate then? Yeah. If Republicans take the Senate, John Bozeman is currently, the ranking member. He's from Arkansas, and he's worked closely with Stabenow's office and been in a lot of discussions about how to regulate crypto. So he would likely take over his chairman, I believe, unless you know something I don't, Alex. And, you know, there's a growing number of senators on that committee that are engaged. I think, you know, John Thune and Deb Fisher, Tommy Tuberville. You know, these are, you know, more downedias. But, you know, there's a growing sort of interest in the Senate. But I don't know if you have anything to add Alex or we think

Starting point is 00:44:46 Bozeman might go elsewhere. I think it's most likely Bozeman. As Kristen mentioned, his staff has been working on crypto issues now for quite some time. So this is new to them and they're excited to dig in. I will say that they may choose first to prioritize passing a farm bill because that was supposed to happen this year and did not. And Bozman's from Arkansas. He's got a bunch of farmers he represents, and they've got to do one of the other things that the Ag Committee is supposed to do. Okay, okay. So that, but then it would only be a little delayed. It sounds like.

Starting point is 00:45:22 All right. So how about House Ag? So House Ag, we have G.T. Thompson from Pennsylvania, who's the current chair. He would likely stay as chair. His staff is, sorry, if Republicans maintain control of the House. Okay. Current chair, current Republican control, G.D. Thompson sticks around. His staff has worked on these issues forever. One of the staffers, Paul Balzano, has been there since the previous chair, Congressman Conaway and crafted one of like the original crypto market structure bills, the Digital Commodity Exchange Act.

Starting point is 00:46:01 This is like, I don't know, what, 2018, 2019. So he's been, they've been digging in for a very, very long time. On the other side of the aisle, so if Democrats take control, as we mentioned before, seniority is typically what rules the day on chairmanship. And so David Scott is the Democrat who's currently atop the committee in the ranking member slot. He would potentially be chair. He's been chair before. He's quite close with like the CMEs and CBOs and Ices of the world, all the big command.

Starting point is 00:46:34 commodity derivative exchanges and is a little bit less inclined towards crypto. There is some question as to his health, whether he would take on this task. And so it might go to a different further down Dias, a Dem member. And we could have new blood and new opinions and new options for crypto. Yeah. And I would say, you know, David Scott, you know, the Agriculture Committee, obviously voted on the FIT 21 bill last summer. And in the Agriculture Committee, he allowed that vote to move by voice vote so that the numbers, when the Democratic members, would have to go on record as voting for it or not. But when it did come up for a vote in the House Financial Services Committee, where he also said he voted against it. So maybe at one of our ideal folks,

Starting point is 00:47:29 but we'll have to, you know, kind of see who's in power and, you know, if he decides to stick on. Okay. So then the next one that I think we mentioned was Senate Commerce and remind us what, what that, how that could affect crypto policy. So Senate Commerce oversees like tech broadly. So when there's like, I don't know, Facebook hearings or Google hearings or what have you, It's typically over at Senate Commerce.

Starting point is 00:48:01 NFTs and collectibles kind of fall over there. They have a really, really broad remit. In the House, energy and commerce also has kind of energy issues. In the Senate, it has its own separate committee. So Bitcoin mining might be an energy in commerce, but it might not be in commerce. Regardless, with a Republican Senate, Ted Cruz, who's currently in a tight race for reelection in Texas, would be the chair. He's made no secret about his love for Bitcoin and crypto and its importance to his state. So he, I mean, Senate Commerce has kind of sat on the sidelines for a very long time

Starting point is 00:48:41 when it comes to our issues. I would expect that to change if he's chair. They'll be, I think, very actively trying to carve out a lane for themselves. And if he loses, then who might be the the person who, the Republican who would be in charge? Well, next to line is John Thune. So it could depend on, you know, what Thune is wanting to do with leadership and others. And then from there it goes to Roger Wicker. So. Yeah.

Starting point is 00:49:10 But Wickers over at, I think, armed services. And then you have Deb Fisher, who's also in a tight race in Nebraska, too. So it could be a bigger question mark. But what I will say is if Ted Cruz, loses in Texas and Deb Fisher loses in Nebraska, Republicans might not have control of the Senate in general. So we might be having a different conversation entirely. Ted Cruz, I think, latest polling came out this morning, put him, it was New York Times. I think it put him up by five. Oh, okay. Okay. So not that tight. Yeah, it's been, it's been like one or two points,

Starting point is 00:49:50 but yeah, he has been, I think, in the race for his life for the first time, and I think quite some time. So that's part of a broader, I think, demographic and party realignment in Texas. Okay. So, okay, so tight but not super tight. So if the Democrats take the Senate, then who would be in charge of commerce? I think it would continue to be Maria Camp while she's currently being the chair of the committee. And what's her? It represents the state of Washington.

Starting point is 00:50:20 Does she have any crypto positions? Nothing too strong that comes to mind. In either direction. She's been really focused on privacy issues, mostly. So privacy is like the big ticket item that the Commerce committees have been focused on lately. So it's actually an interesting hook to get into the committee and talk to them about crypto issues because you can talk about zero knowledge proofs and the ability to attest information without, I don't know, showing personally identifiable information. Okay. There's a bunch of different kind of issue sets that they are within their remit.

Starting point is 00:50:55 Yeah. I mean, I think that crypto generally has a lot of different areas that different people of different political strikes can get interested in. Okay, House, Energy, and Commerce, if the Republicans keep the House, then who would be in charge of this? And what's their take on crypto? So there's a current race for chair because Kathy McMorris Rogers, who's the current chair, is retiring. Bob Lata from Ohio and Brett Guthrie from Kentucky, I think, are two of the ones

Starting point is 00:51:25 who are making a play for it. Neither have like really dug in. I think they've been like loosely involved on some of the blockchain bills that energy and commerce has looked at this this past year, but I think mostly kind of blank slates. Again, like this is, our industry has spent so much time inundating ag banking, House financial services, and so on, that the other committees haven't had quite as much love. But I would expect that to change as more members are interested and excited to dig into these issues. Okay. And if the Democrats take the House, then? Frank Pallone, who's the current ranking member, I think, would stay as he would stay on his chair. And is he pro or anti-crit? Or does he have any stance on crypto?

Starting point is 00:52:14 I don't think he's been like wrapping his arms around it, but I don't think he's been very aggressively anti. Again, it's one of those issues that it just hasn't come up that much on the committee. So most of the members haven't taken really aggressive points of view one way or another, whereas the other might be the case in House financial services. But this kind of goes back to as, you know, new members are getting elected and crypto was supportive of their campaigns and they're more educated. on it, we're going to start seeing this sort of broader interest across some of these other committees. And, you know, even the lobbying resources in Washington have grown tremendously in the past two years. Prior to that, there just wasn't time to get to all 535 offices. And that's changed. Like, we were very organized as an industry now. We're making sure we're doing outreach to all of the

Starting point is 00:53:08 offices because, you know, these bills are getting to the stage where they're having votes. And so it's one of the reasons why the political work that's going on with the election cycle is going to be really helpful for next Congress. Okay. So last two committees would be Senate finance. If Republicans take the Senate, then who would be in charge? So if Republicans take the Senate, it's going to be Mike Grapeau, who was the, he's from Idaho. He was the banking committee chair. I guess this was two Congresses ago before Pat Toomey. His staff has been leaning in. So he and the, the current chair. So he's currently ranking member, the current chair, Democrat Ron Wyden, who's been a long time ally of the industry and has also been just kind of like a long time

Starting point is 00:53:53 interested party in like the evolution of the internet and freedom to kind of code his speech and so on. Both of them last summer released a joint request for information for crypto tax issues. So we've had meetings with both of their staffs. They're both super interested and dug in and like really wants to understand this issue set so that they don't when there's a tax bill next year, they don't run into what the Senate ran into back in 2021 with the infrastructure bill when there was literally an argument about definitions of consensus mechanisms on the Senate floor and it held up the signature like achievement of the Biden administration. So they'd like to not do that again. So both sides have decided to.

Starting point is 00:54:44 to learn their lesson and get the info they need. Well, and Wyden has been really good, too, in getting to know the crypto community. It came out to consensus this year. And, I mean, he's really, like, taken an interest in this. And so, yeah, we're not going to see a repeat, as Alex was saying, of three years ago with infrastructure. Okay. So that one, it sounds like no matter which party's in charge, there will be kind of an advocate for crypto on and that. And then the last one would be House Ways and Means Committee.

Starting point is 00:55:12 Yeah, this is one where I'm not sure at this stage, there's a major difference either way. I don't know, Alex. You know, we currently have Jason Smith on the Republican side, Richard Neal on the Democratic side. This is a committee that historically has not engaged. And even in some of our early meetings, they're still at a very basic level. But I think this is one where there's like a huge opportunity for members of Congress to step up regardless of which party's in charge. Yeah, I agree. There's a bunch of Down Dias members who have done a ton. David Schweiger from Arizona, who's currently in like a really tight race. He was actually one of the original co-founders of the blockchain caucus. Claudia Tenney from upstate New York, her staff is really terrific and has dug in on a bunch of these issues. Drew Ferguson, who's unfortunately retiring, has introduced some staking tax legislation. But yeah, the chair and the ranking member, so Jason Smith's the chair from Missouri. his staff, like they've been there for a very, very long time, super experienced, have started recently to dig more into crypto as they've realized that like this isn't going away and we need to learn more about it. It's also become, I think, more politically salient for House Republicans to be pro-crypto. And so they started to sit up and take notice and say, okay, well, maybe we should start being productive. So they've crafted a like a financial innovation working group to plan for next Congress if they maintain control, and crypto is kind of a subset of that.

Starting point is 00:56:43 I think Ron Estes is is chairing that. On the Democrat side, so Richie Neal from Massachusetts, he's, so you've got to be kind of careful with Massachusetts because obviously it's Elizabeth Warren's home state. He's kind of a, he might be the dean of the Massachusetts delegation. He's kind of been around for quite some time. He's got very experienced staff. Some of the staff used to work at the IRS, and so they've dealt with the broker tax rule from the other side of the equation. But again, like a lot of this, as Kristen said, it's kind of a blank slate. So it's a huge opportunity for the industry to get in and educate and then also get some of our allies onto the committee and help them be productive and successful.

Starting point is 00:57:29 Okay. And that one, you know, I think as we mentioned earlier, has an impact on tax policy. And I just wondered, everybody always talks about like stable coins and market structure, but is there some kind of potential crypto tax legislation that might be in the works? Yeah. So I would say less crypto tax legislation and more like a bunch of discrete issues that could get factored into an overall tax package. So we're all familiar with the broker rule from 2021 that we've talked about. We're waiting for, I think, the second tranche of implementation or rule finalization

Starting point is 00:58:05 this year, there could be adjustments to that that get factored in. You could have something like de minimis, which is set of threshold below which like use of crypto in payments isn't a taxable event. So if you wanted to buy or isn't like a capital gains event, if you wanted to buy like coffee with Bitcoin, for example, you don't want to have to pay capital gains on that. There's a, there's a few things around like realization. If you stake or unstaking asset and get like a liquid staking token in return, is that an asset realization event, or is that just kind of a receipt for equivalent value? If you bridge from one network to another, it could be the same exact asset that's just on a different chain, and you've locked one up on a smart contract on one and released

Starting point is 00:58:52 on another, is that a taxable event? Because you've relinquished control on one, but you've got the same thing on another. And so just clarifying a few of those things around the edges are are quite small and won't have any sort of like revenue hit, but for the purposes of like scoring a tax package, but could be like quite impactful from just like general clarity for entrepreneurs to be able to operate. Okay. And I would say generally it's really, really hard for these individual issues to be enacted into law as like a one-off thing. What happens is they tend to open up tax issues into one big bill and they have to make all the math add up. and they do it all as once.

Starting point is 00:59:34 So these are issues where you're never just going to get like the de minimisville like pass through the House and the Senate and signed in a lot. You have to have a tax specific legislative vehicle for those things to go on because it's just politically impossible to loom them as as one-offs. And so I think it's going to be, you know, a huge opportunity. And we also want to make sure there aren't, you know, sort of provisions that are introduced that sort of disadvantaged crypto in a way that that doesn't. make sense. And so even even just being able to play defense on that front is going to be important. Yeah. There's there's two ways to I think that tax could play out next year. One is if we have split Congress. So you have one party that controls the White House. You have Republicans control the Senate and you have either Republicans or Dems who control the House. You're going to have

Starting point is 01:00:23 some horse trading. You're going to have things get in, things get out. But ultimately it's going to be like a bigger piece of compromise legislation. If Republicans have have a trifecta, it unlocks something that's called budget reconciliation, which for budgetary provisions, either like revenue or spending, you can pass that out of the House and it allows you to pass it through the Senate on only a 51 vote threshold instead of the typical 60 vote threshold that's required to enact any legislation. So if you're Republicans, you have 51 seats in the Senate or you have the White House plus 50, then you can do a party line vote for that tax package all the way through to the president's desk, which is what they did back in 2017. So that's kind of the other thing

Starting point is 01:01:11 that we're waiting to see what happens in a week and a half. Is budget reconciliation going to be possible or are we doing this kind of big bipartisan horse trading exercise that is going to be a little bit more complicated? Okay. So now I do want to cover some of the chairs that. that are going to be most important of the different agencies for crypto. So in a Trump presidency, who do you think he could potentially name as SEC chair? I think the important thing is it's not Gary Gensler. That's the most important thing. But are there's no names being batted about?

Starting point is 01:01:48 I mean, there's a bunch of names that have been reported in the press. TBD, whether any of those have any credence, some work in crypto, some work in traditional finance. I think generally speaking, Republicans in the last four years, conservative financial regulatory orthodoxy has trended towards kind of pro-crypto. So more or less any Republican appointee you're going to get is going to have a more, I think, nuanced and less antagonistic view towards the industry, not to mention the fact that Trump has really embraced crypto and he said he wants to make America the crypto capital of the world and a Bitcoin superpower.

Starting point is 01:02:23 So if that's kind of the tone that's being set at the top, you're not going to have someone going totally rogue and not kind of marching in line. On the other side of the aisle, if Harris wins, it's a little bit more of an open question. SEC Chair Gensler has two more years on his term. It goes through the end of 2026. That said, it's possible for a president to not necessarily fire, but kind of re-rank. So Harris could theoretically appoint a different commissioner as chair and Gary becomes just a normal run-of-the-mill chair for the commissioner for the remainder of his time. And there's other ways, too, that presidents can try and get them out of there. They could, I don't know, name Gary Ambassador to the UK, for instance.

Starting point is 01:03:14 He'll no longer be a deputy if that's the case. Okay. But so of the different contenders under Trump, are any of these names? potentially pro-crypto like Paul Atkins, Heath-Tarbert, Chris John Carlo, well, obviously he is, he's crypto-dead, Robert Stevens and, well, has her purse is, but I don't know, I don't know if she Yeah, no, I mean, that's kind of the rumored shortlist that you just went through. Dan Gallagher is the last one, the Robin Hood. All of them would have a pro-cryptor, crypto posture if nominated and confirmed.

Starting point is 01:03:51 it would be, I think, an absolutely massive upgrade for any of those names that you listed. Okay. And what about CFTC chair? I think CFTC is a little bit less clear. The SEC, everyone's been spending all of their time thinking about, obviously, because Gary is kind of the clear and present danger. If Harris takes over, she could install a new chair, current chair, Benham could stay on. I think to some extent, his ability to legacy build has been somewhat constrained by the fact that Gensler is on the other side of the equation. So, I mean, he's appeared before Senate Ag a bunch of times. He's actually an old staffer of Deputy Stabenow, the current Ag Committee chair. So he has wanted to expand the SCFTC's remit over crypto. And that could be a good

Starting point is 01:04:48 outcome if Gensler is no longer at the SEC, but Benham is still there. If Trump wins, I think there's a bunch of different names out there. The two current Republican commissioners, Commissioner Summer Mercinger, she's got some really terrific dissents from some of the recent CFTC actions against crypto. And then Commissioner Fam was actually just at a blockchain association event last Monday in New York that I was with with Kristen. And she was really terrific. And chairs that. the Global Markets Advisory Council that has a bunch of kind of crypto industry folks on it. So both would be great options. There might be other private sector options to who are under consideration.

Starting point is 01:05:30 Ultimately, the whole transition process is a very, very kind of closed in one because, I mean, everyone's jostling for advantage and wants to get these jobs because they're really great and important and consequential jobs. All right. So then two more that I want to cover our Treasury. Who do you think the different potential presidential candidates might choose for that? Well, I think on Harris, you know, we could see the current secretary stay around. But the name that I hear most often is Wally Adayamo being next in line. He's the deputy treasury secretary. That's probably one I could see. being switched out because, you know, Yellen has served for a long time and should be a priority. But I don't know if there's others you've heard of Alex on that list. Yeah, there was supporting about former Amex CEO and current, I think General Catalyst Chairman Ken Chenow.

Starting point is 01:06:34 And I mean, like, he was at Amex. He understands payments. He's going to be more pro-business than maybe some of the current more Warren-esque regulators, but he might have a very strong point of view about how crypto should look when it's involved in payments. That's a general catalyst has a bunch of crypto investments. So who knows? On the Republican side, there's been kind of a bunch of names that have been reported. Senator Bill Haggerty is one of them. He's done a lot for the industry. Help host that a crypto roundtable at Bitcoin, Nashville. Bill, he's a senator from Tennessee and has been kind of the conduit to the Trump admin from the crypto industry or the Trump campaign.

Starting point is 01:07:22 Scott Bessent from Millennium, who threw a huge fundraiser for Trump earlier this year, has been one of the names that's thrown around. Bob Lighthizer, who was U.S. trade representative, and then Howard Lutnik, who's currently chairing Trump transition. And I mean, Howard has made no secret about how much he loves Bitcoin. He has a pretty fiery speech at Bitcoin, Nashville, about it. Cancer Fitzgerald is one of the first, I think big finance houses that really dug into crypto, set up a Bitcoin lending desk. They manage Tethers backing reserves. So there's no shortage of good options. And I think it just remains to be seen who President Trump would feel most comfortable with. Okay. And then Federal Reserve under the two different presidents. You know, I actually don't know on that one. Candlely haven't looked at the Federal Reserve quite as much just because Powell has, I think, been fine.

Starting point is 01:08:24 It's mostly been Michael Barr, I think, the vice chairman for supervision, who's been a little bit less positively inclined towards crypto. That one is a little bit more opaque. And frankly, I think the banks will have a much sharper point of view on who gets into those roles, given all of the kind of the huge tug of war currently over capital standards. The Federal Reserve will come into play if stable coin issuance is regulated by the Federal Reserve. If stable coin issuance is regulated by maybe the OCC, which does bank chartering, then this could be a different conversation. unclear at the moment, I think, who Vice President Harris would appoint, but President Trump, I mean, Brian Brooks was the chair last go-round and granted Anchorage a bank charter in the waning days of the Trump admin.

Starting point is 01:09:21 So by any account, I think there would be probably a more possibly disposed comp controller over there. And at the FDIC, I think it really remains to be seen because right now, Christy Goldson, Smith-Romero, who's one of the current CFTC commissioners, is up to lead the FDIC. Her nomination is currently kind of before the Senate. If she gets confirmed before the end of this year, then she'll be chair. If she's not, then Trump will have an opportunity to name one of his own. Or if it's Harris, she might choose to go with Chrissy Goldsmith-Ramero or she might choose to go with someone else entirely.

Starting point is 01:10:02 So that one's a little bit less clear. And Christy Goldsmith-Romerow is not positively inclined toward crypto, right? That's correct. Yeah. I will say more than other anti-crypto regulators, she's at least displayed an openness to learning and taking meetings. And the technology advisory committee, which she chairs over at the CFT, released a report on DFI that kind of described the process of decentralization and some frameworks about how to potentially regulate it. So she's open to learning, which is a lot more

Starting point is 01:10:43 than I can say about some of the other folks than the government. So never say never. Okay. Well, last question before we close out. So obviously, as people can tell, it's a little bit of a crapshoot and exactly what's going to happen. Obviously, the House and the presidency are probably more up in the air than the Senate, but still even that, you know, obviously this race, who knows. But what would you say are the chances for crypto legislation in the lame duck? I think the lame duck is pretty low odds. Potentially stable coin is on the table. You know, lame ducks can usually go one or two ways. They're very, very active where a whole bunch of things get negotiated and then lumped into a big package and voted out altogether.

Starting point is 01:11:31 or they're the opposite. They decide to do the absolute bare minimum and go home early. But I do think Staplecoin is on the table for this year. And market structure is something that will most likely get done in the next Congress. Yeah. As we mentioned, Chairman McHenry is retiring. So he is very much in legacy mode. And I think he'd love to get some crypto legislation enacted.

Starting point is 01:11:55 So he and ranking member Waters have been, I think, at 90% on Stablecoin. legislation agreement. The question is what happens over in the Senate. So say you want to attach this to the National Defense Authorization Act, which will usually sales through. It's a bus pass piece of legislation that goes through at the end of almost every year. What happens over in the Senate is the big question mark. So that's why it's important that Senator Haggerty introduced his own stable coin bill because that gives like a negotiating anchor for for Senate Republicans. So I agree with Kristen. I think odds overall are low, but if anything happens, it's going to be stable coins. actually there's one other question that I just thought of which is obviously kind of like stable coin and market structure sort of overdue as pieces of legislation that the industry has been wanting but after that are there other things or is it really just you know those would be good enough and then the crypto industry doesn't need more legislation or yeah I think that's a good question so those are two big ones and listen they're overdue yes but if you think about stable coin legislation those discoveries

Starting point is 01:13:01 started with Libra in 2019. Most legislation, especially something that's comprehensive and new like this, takes somewhere between seven and ten years. These things don't happen quickly and they don't happen overnight. So, you know, it's not like we're behind on this, but it is time for us to start getting something enacted into law. I do think, you know, there are the tax issues we discussed earlier that would be helpful to do legislatively. I think, you know, there's a lot of interest around illicit finance, and most of the bills we've seen on that would do more harm than good. I also think there's a really good chance that whatever happens with market structure that the defy question is pushed to later. And so, you know, depending on how that market

Starting point is 01:13:45 develops, there may be gaps, you know, that need to be filled with Congress. But I think it's an open question of if we're going to need something, you know, comprehensive for defy or not. I think a lot of that will depend on how the market develops. Okay. All right. Well, you guys, this has been such a fantastic conversation. Where can people learn more about each of you and your work? Yeah.

Starting point is 01:14:13 Well, I'll start. You can visit us at the blockchain association.org or follow us on Twitter at at blockchain ASS. And we represent about 100 companies in this space. And it has just been really remarkable to see how sophisticated the industry has become. So if you're not a part of us, you should reach out and be a part of the effort. And for us, paradigm.xyz, all of our policy writings are there. And I'm just at Alexander Grieve on Twitter. I think the last thing that I would leave our listeners with, because the election's in basically a week and a half, is on election night, what I'm going to be watching is one,

Starting point is 01:14:54 Senate control. So Montana, as we discussed in Ohio, Montana for control of the Senate, Ohio, did crypto have the impact we wanted to have in Ohio? For the presidential, I think everything is going to come down to Pennsylvania. So we'll see how all the other swing states manifest. But Pennsylvania might not know the winner until Saturday, but that is going to come down to Pennsylvania. And then for the House, the House control will probably run through New York and California. So incumbent Republicans in New York like Mike Lawler in the 17th district or Mark Molinaro in 19th in California, David Valadeo in the 22nd, Mike Garcia in the 27th. If they're winning, Republicans are likely hanging on to the House.

Starting point is 01:15:40 If they're losing, Dems probably take it. So that's how I'm kind of thinking through this. But obviously, we'll see what happens in a week and a half. Okay, great. Well, it's been a pleasure having you both on Unchained. Thanks for having us. Thanks, Lauren. Thanks so much for joining us today to learn more about Kristen and Alex and these upcoming races.

Starting point is 01:16:00 Check out the show notes for this episode. Unchained is produced by me, Laura Shin, with up from Matt Pilcherid, Roni Ranovich, Megan Gavis, Pamma Jimdardt, and Marka Korea. Thanks for listening. Unchained is now a part of the Coin Desk Podcast Network. For the latest in digital assets, check out markets daily five days a week with host Noelle Atresen. Follow the Coin Desk Podcast Network for some. of the best shows in crypto.

Unchained - It’s Not Just the Presidency. Congressional Races Matter a Lot for Crypto - Ep. 726

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