While Democrats have yet to outline much of their encryption policy, the Democratic National Convention showed a significant change in tone, Justin Slaughter and Shayla Warren say.

There's nothing quite like a political convention. The rallies with patriotic songs and speeches, the parade of speeches by party leaders, and of course the thousands of balloons that fall like snow on the new presidential candidate.

But for crypto, the Democratic National Convention in August was particularly auspicious. Despite open hostility from parts of the Biden administration, crypto was a welcome participant for the first time. It makes sense: Cryptocurrency owners now make up about 20% of all registered Democratic voters, according to a Paradigm poll of Democratic voters conducted just days before the convention. There is a serious electoral risk if some of those Democrats flip to the Republican Party in a race that could be won by a wide margin. Given that Republicans have been so vocal and aggressive about crypto, the presence of crypto at the DNC suggests that the industry is finally beginning to take on a truly partisan character. Those on the ground in Chicago were able to see the Democratic interest blossom firsthand.

While most of the crypto-focused conversations were offstage, there was a hint of crypto’s growing importance in the main convention hall as well. Young crypto-friendly congressmen and congressional candidates like Rep. Jasmine Crockett (D-Texas) and congressional candidate Shumari Figors of Alabama got significant speaking slots. Some crypto companies also hosted policymakers for discussions outside the convention hall, as other companies and organizations have done for decades. Vice President Harris herself emphasized the importance of building an “economy of opportunity” in her keynote address, with a special note praising the role of the founders in making America prosperous.

But that was just the tip of the political iceberg. It’s easy to forget this when we watch prime-time political convention shows, but political conventions are much more than a few hours of short speeches and slick videos. Political conventions are essentially about allowing members of a political party to gather in one physical space every few years, whether to socialize or strategize.

As part of this collective process, the week was filled with panels, meetings, and even press interviews, all designed to help the party build consensus around its political views, goals, and even beliefs. These are the mediating materials that truly shape our decentralized political parties. And this is where cryptocurrencies really make their voices heard.

Throughout the week, there were panels on the basics of how cryptocurrencies work and how Democrats can work to mend the party’s strained relationship with crypto. There were discussions on the importance of maintaining the dollar’s ​​dominance and the role of stablecoins. And there were repeated discussions with dozens of policymakers on how to appeal to cryptocurrency owners.

In our conversations that week with a variety of policymakers and opinion leaders, what struck us most was not the statements from policymakers who were pro-crypto, but the statements from the skeptics. Even some of the crypto skeptics who were enthusiastic about crypto argued that the current enforcement-only approach of the SEC wasn’t working, and that legislation was needed. As two people who have been advocating for sensible legislation for years, this was music to our ears.

Another part that was particularly noticeable was how normal it was. Policymakers were curious about cryptocurrencies, both how they worked and how they would play into this year’s election. But that curiosity wasn’t tinged with the unease that had accompanied some of the cryptocurrency debates in Washington, D.C., until last year. Instead, we were seen as just another young, new industry that policymakers were trying to figure out.

The Harris campaign underscored this clichéd normality when it declared its “support” for the growth of cryptocurrencies in a press interview with campaign policy director Brian Nelson. Despite some unease about Nelson’s views on crypto given his recent role as Treasury Under Secretary for Terrorism and Financial Intelligence, Nelson declared on Day 3 of the Democratic National Convention that a Harris administration would “support” the growth of cryptocurrencies in America. The statement was remarkable for the extent of the political war waged over cryptocurrencies, and unusual for how crude it was. Why wouldn’t a U.S. president want the industry to remain American-based?

Since then, the Harris campaign has launched its platform, which focuses on American entrepreneurs, small businesses, and innovators. While cryptocurrencies and other technologies are not mentioned by name, the rhetoric and tone of the platform is strikingly different from that of the Biden administration. Since the Democratic National Convention, we have both continued to meet with policymakers and candidates across the political spectrum, and what’s striking is how similar most of the conversations are, whether with Democrats or Republicans.

Policymakers are tired of (and in some cases shocked by) the SEC’s approach under Gensler. They want to preserve and advance America’s national security and economic interests. And they are generally very concerned about inadvertently ceding technological advantages to other jurisdictions, as happened with semiconductors.

More than anything else, there was a general sense of simple acceptance of cryptocurrencies in Chicago. Democrats still have a long way to go in finding practical solutions for how to regulate cryptocurrencies, but the first step to building something is to commit to doing so. We were pleased to see Vice President Harris recently acknowledge that digital asset technologies need to be encouraged; while we may not have a blueprint for how Democrats will implement a crypto reset, both the Democratic National Convention and the recent Crypto4Harris event showed that Democrats across the ticket no longer default to questioning whether cryptocurrencies have a right to exist. That’s progress worth celebrating with balloons.

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