Presidential contender Kamala Harris is actively seeking the crypto vote.
The cryptocurrency market experienced a significant uptick on Monday as U.S. presidential hopefuls vie for the support of crypto enthusiasts. Today’s highlight is Kamala Harris’s commitment to endorsing crypto legislation aimed at ensuring that owners and investors in digital assets can benefit from a well-defined regulatory framework.
Although the specifics were limited, the overall sentiment was enough to propel crypto prices upward, with several altcoins and memecoins emerging as the primary gainers. Solana (SOL 6.41%) surged by 7% within the last 24 hours as of 5:00 p.m. ET, Shiba Inu (SHIB 6.95%) increased by 5.7%, Pepe (PEPE 11.83%) saw an 11.5% jump, and Bonk (BONK 9.15%) climbed by 10.4%.
The Crypto Policy Debate
Investing based on political movements typically isn’t advisable, but the influence of politics and policy on investments is undeniable. This is particularly true in the crypto market, where nearly all exchanges and tokens have had their run-ins with the SEC over the years.
With both presidential candidates now advocating for some form of cryptocurrency regulation, there’s potential for increased development and innovation in the space. Notably, meme coins and altcoins have shown the quickest reactions to these developments.
How Regulation Could Benefit the Crypto Market
While Bitcoin and Ethereum dominate headlines, the bulk of innovation is happening elsewhere. Blockchain platforms like Solana outperform Bitcoin and Ethereum in terms of transaction speed and cost, handling significantly more transactions. A regulatory framework for cryptocurrencies could shift attention and activity toward these altcoins.
Memecoins such as Shiba Inu, Pepe, and Bonk may simply be along for the ride. They capitalize on the “meme” aspect of crypto and might ultimately become viable transaction tokens. However, achieving legal status for ownership would represent a substantial step forward for these tokens, regardless of their blockchain affiliations.
Where Will Crypto Go From Here?
The crypto sector’s most pressing need is clarity regarding regulatory guidelines. The U.S. SEC has openly acknowledged its lack of clarity regarding permissible and impermissible actions under current securities laws.
Under a new administration, which will begin in January 2025, two major changes could reshape the landscape. First, a new SEC leadership could influence the industry’s direction without altering existing laws. Second, Congress may enact new legislation providing clearer regulations and boundaries for the sector.
No matter the outcome, a more supportive administration could be advantageous for the crypto industry, possibly unlocking billions in investments that have been diverted overseas or sidelined.
Historically, we witnessed a surge of funds entering the market following the approval of Bitcoin ETFs, and a similar influx could occur for blockchain-based companies under a clearer regulatory environment. Investors seem to be banking on this scenario today, potentially driving crypto valuations upward. While tokens with tangible utility represent solid investment opportunities, meme coins may ride this upward wave longer than many analysts anticipate.
Travis Hoium holds positions in Ethereum and Solana. The Motley Fool has positions in and recommends Bitcoin, Ethereum, and Solana. The Motley Fool adheres to a disclosure policy.
