There’s no question about it:  President Joe Biden is the ‘Stifler-in-Chief’ when it comes to crypto. But even if he can’t exactly ‘destroy’ it (since crypto is much bigger than just what a U.S. President does or doesn’t do), he can continue to try to wound it within the United States and do everything he can to inhibit its growth. Clearly, that is Joe Biden’s agenda. His chief hatchet woman in the Senate is fake Indian Massachusetts Democrat Senator Elizabeth Warren, who is crypto’s most dedicated foe and who is personally trying to raise a self-proclaimed “anti-crypto army” as part of her 2024 re-election campaign.  

Biden’s latest attack on crypto, Web3, and the blockchain involved his recent veto of the bi-partisan H.J. Res 109 congressional resolution, which passed by overwhelming margins in both the House and Senate as a repeal of what is called SEC Staff Accounting Bulletin No. 121 (SAB 121) and dealt with an accounting rule. Why is this significant?

Well, for one thing, potentially tens of trillions of dollars are on the line (but what’s a few trillion among friends?!). The simplest answer is that it is all about power and control. The “Mad Hatter” of Anti-Crypto, SEC Chairman Gary Gensler, is Biden’s enforcer. Even though major financial institutions like Blackrock, one of the world’s largest asset holders (with over $10 trillion dollars in assets under management), have recently embraced crypto exchange-traded funds (ETFs), Biden wants to continue to force financial institutions to list any crypto assets as corresponding “liabilities” on their balance sheets. If that sounds somewhat crazy to you, then you get it. The banking industry had reached out to Gensler to try to find some reasonable middle ground, but the SEC’s response was basically, ‘Go pound sand.’ So, the crypto industry and its growing numbers of supporters eventually turned to Congress to try to get some relief. To be sure, the crypto currency market is volatile and guardrails are needed, and the executive branch does have an interest in protecting the SEC’s authority to issue its own guidance independently of Congress. But to list assets as ‘liabilities’ is truly an Alice in Wonderland approach to the question -- where ‘up’ is ‘down’ and ‘forwards’ is ‘backwards.’ Which is why even Democrats are waking up to the SEC’s insanity and many voted for the repeal of this ridiculous rule. Repealing SAB 121 was a common-sense change that would have helped bring the U.S. out of the Dark Ages of crypto pseudo-regulation. The resolution passed 228-182 in the House and by an even larger margin in the Senate, 60-38. But the ‘Stifler-in-Chief’ stopped it dead in its tracks.

This veto occurred right after I attended a recent major crypto and blockchain conference in Austin, Texas, called Consensus 2024, which hosted more than 15,000 attendees from more than 100 countries, representing more than 6,800 companies. RFK Jr. was a featured speaker, while politicians as diverse as leftist Senator Ron Wyden and Republican Majority Whip Tom Emmer spoke as well. Prior to the veto, the conference atmosphere was abuzz with fresh hope that, now with many more Democrats coming onboard, crypto had finally ‘arrived’ and would not be made into a political issue. If most leaders on both sides of the aisle could agree that these exciting new fields of innovation and financial freedom should be vigorously pursued and encouraged in the U.S., it would be good news for the country as a whole. Biden’s veto, issued on the last day of the conference, could not have been a bigger slap in the face. Instead of embracing the future and undergirding the industry, the Biden Administration essentially told the tens of thousands of innovators and potential capital investors in crypto, Web3 and the blockchain that their work is a ‘liability’ and should be treated as financially ‘radioactive’ and without present value.  

Responding to Biden’s veto, the Blockchain Association released a statement on X saying that, “By vetoing this repeal [of SAB 121] the Biden administration is swimming against the tide of public opinion and growing consensus in Congress that digital asset innovation should be supported -- not punished.”

The next big test will be the Financial Innovation and Technology for the 21^st Century Act (FIT21), which passed in the House 279-136, with 71 Democrats supporting it. But thus far not the Biden Administration, which means that any vote for Biden is a vote against crypto.  If the Biden Administration cannot come to terms with or negotiate something as basic and straightforward as an accounting rule, there is no hope that it will achieve anything substantive over the next few months or during a second term.  It is more likely to try to stifle crypto, the blockchain and Web3, probably because of presumed behind-the-scenes payoffs from Big Tech and other corporate monoliths that are happy with the status quo and don’t want competition to their “corporate networks,” where they rake in untold billions and harvest our data for their own ends.    

Former President Trump has now embraced crypto and its potential. This move inspired the hacks at Politico to opine that “Crypto is Trump’s new weapon against Biden.” Well, duh, that’s sort of what happens when you oppose the future. Trump recently stated, “I will ensure [that] the future of crypto and the future of Bitcoin will be made in the USA, not driven overseas.” In a first, the Trump campaign has begun accepting cryptocurrency donations. Potential donors can contribute to the campaign through multiple cryptocurrencies, not just Bitcoin.

Galaxy Digital CEO Mike Novogratz, who describes himself as “broadly a center-left Democrat,” speaking to CNBC’s “Crypto World” at Consensus 2024 prior to the Biden veto, said: “For me, it’s game over. People have finally got it. This should not be political. The Democrats don’t want to lose an election over something as stupid as a new technology that’s good for the country.” Sorry Mike, but oh yes they do! By now there may be as many as 85 million or so crypto users in the U.S. Novogratz wondered aloud, what if just 20 per cent of them are single-issue voters? That’s 17 million voters.

The Republican Party should specifically target pro-crypto voters in swing states and in close races throughout the nation. Biden’s veto of SAB 121 and Warren’s “anti-crypto army” are all they need to know. Campaign themes should focus on the fact that the Biden Administration, which leads the Democratic Party, seeks to stifle technological innovation, destroy financial independence and is in the pocket of Big Tech. 

Meanwhile, crypto-supporting PACs are gaining steam.  The pro-crypto Fairshake Super PAC and its affiliates have already raised some $160 million during this election cycle to support pro-crypto candidates and initiatives.  

However, if you love authoritarianism, if you embrace the status quo and hate financial freedom, then Joe Biden is your man and Senator Warren is your fake Indian woman. 

A.J. Melnick is a former Pentagon analyst, was one of the early developers of the field of cyber threat intelligence, and is a retail investor in crypto.

Image: QuoteInspector.com