In letter to Biden and Harris, crypto coalition calls for clearer rules and warns of risks

A group of over 50 crypto firms called on U.S. President Joe Biden and Vice President Kamala Harris to establish clear rules for the digital asset industry and says without it, consumers have been harmed and innovation halted. 

Other jurisdictions, including the European Union, Japan, and the United Kingdom, have moved ahead with crafting regulatory frameworks, the Crypto Market Integrity Coalition wrote in a letter to the White House on Wednesday. The coalition was founded by Solidus Labs, Coinbase, Circle, and The Digital Chamber and has members including Robinhood, BitGo and Chainalysis.  

"Many of the losses of the last few years could have been avoided with basic consumer protections," the members said. "This is of particular concern to CMIC members given our public pledge to market integrity and efforts to set strong industry standards for monitoring for and eliminating market misconduct."

Regulators' enforcement approach to crypto, without clear rules, has caused compliant U.S. firms to lose customers and market share to entities that don't follow the rules, the letter read. 

Crypto entities have long called for regulatory clarity in the U.S. while others too have criticized regulators' approach. The U.S. Securities and Exchange Commission and the Commodity Futures Trading Commission, among other agencies, have brought charges against crypto exchanges, firms and individuals over the past few years. Meanwhile, SEC Chair Gary Gensler has repeatedly said that most cryptocurrencies are securities and called for crypto exchanges to register with the agency.  

Over the past year, lawmakers have worked on bills to regulate the industry in Washington. In May, the U.S. House passed the Republican-led Financial Innovation and Technology for the 21st Century Act, also known as FIT21. Seventy-one Democrats voted in support of the bill, including former Speaker of the House Rep. Nancy Pelosi of California. The Biden administration has said it opposes that bill but is open to working with lawmakers. 

"We hope to see your Administration work with Congress to enact such foundational legislation this year," the coalition said on Wednesday. "Missing the opportunity to make law would be a mistake that will be noticed at home and abroad."

Election season

Crypto has held weight in this upcoming election season as millions of dollars have flooded into crypto super political action committees and presidential candidates Harris and Donald Trump begin outreach to the industry. 

The Republican Party expressed support for crypto firms and investors in its platform for the 2024 elections, including vowing to end an “unlawful and un-American crackdown” on the U.S. crypto industry. Trump has also been openly friendly to the industry. 

Harris' team has meanwhile begun reaching out to the crypto industry shortly after President Joe Biden announced he would not be seeking reelection and endorsed Harris to replace him. Harris has not yet openly taken a position on crypto.

On Wednesday, advocacy organization Stand with Crypto announced two new hires: Logan Dobson will be executive director and Sabrina Siddiqui will serve as senior communications advisor. Dobson was previously a senior aide to Sen. Cory Gardner, R-Colo., and Siddiqui previously worked as a spokesperson for tax and economic policy in the Obama Administration's Treasury Depapartment, according to a statement.