As the Republican Party leads the charge for crypto adoption in the US under President Trump, many firms are actively seeking support from Democrats to ensure long-term stability in the industry.
Both the crypto industry and the Democratic Party have their own motivations for collaborating, but progressive opposition to Trump’s involvement in the sector may present challenges to this bipartisan approach.
The Importance of Bipartisan Backing
The landscape of crypto regulation in the US is evolving rapidly, with President Trump championing the cause. While Kamala Harris showed some support for the industry before the 2024 election, Trump emerged as the clear favorite among crypto enthusiasts.
Despite this, reports suggest that the crypto industry is actively cultivating relationships with Democrats.
For instance, Coinbase recently appointed David Plouffe, an Obama aide and Senior Advisor to Kamala Harris, to its global advisory council, despite the company’s previous backing of Trump. This move sparked controversy within both the crypto community and political circles.
Similarly, Ripple, a supporter of Trump’s agenda, hired Lilette Advisors, a lobbying firm founded by former staffers of President Biden. This strategic decision raises questions about the industry’s shifting allegiances.
From the perspective of the crypto industry, aligning with Democrats serves as a safeguard against potential backlash if Trump’s pro-crypto stance loses favor with the public. This calculated move aims to secure long-term growth and stability for the industry.
“In the foreseeable future, Democrats are likely to regain power in key political offices. By avoiding explicit partisanship, the crypto industry can mitigate risks associated with changing political landscapes,” explained Austin Campbell, a professor at New York University’s Stern School of Business and head of WSPN USA, a stablecoin company.
On the other hand, why are Democrats embracing the crypto industry?
The recent struggle to pass stablecoin regulation sheds light on the Democrats’ growing acceptance of crypto technologies.
Following the failure of the GENIUS Act in a crucial vote, several pro-crypto Democrats worked towards building bipartisan support, a move that ultimately paid off.
However, the party still faces challenges from progressive members who criticize the industry vehemently. This internal dissent poses hurdles and liabilities, as evidenced by the GENIUS Act deliberations.
Despite Senator Kirsten Gillibrand’s advocacy for crypto, her support for the GENIUS Act was overshadowed by concerns over Trump’s ties to the industry.
Looking ahead, crypto companies are relying on substantial political contributions to sway Democratic support, particularly in the upcoming 2026 midterms.
While the industry historically favored Republicans in terms of funding, pro-crypto Democrats secured key positions in recent elections. A leaked Signal chat revealed that Democratic insiders and strategists are eager to align with the industry to secure future financial support:
“If Democrats withdraw support for this [the GENIUS Act], they risk losing significant financial backing in the future. It would be detrimental to their political standing not to support it,” cautioned Avichal Garg, a managing partner at Electric Capital, a VC firm. Reports from The Lever indicate that influential strategists share this sentiment.
Ultimately, there is a mutual benefit for both Democrats and the crypto industry in forming alliances. While the industry seeks stability amid political transitions, the party aims to maximize revenue streams for electoral success.
Although challenges may arise within the coalition, the shared objectives of both parties underscore the importance of their collaboration.