It is anticipated Republicans will gain control over the House of Representatives in 2023. Moreover, Donald Trump announced his candidacy for President of the United States in 2024. Whoever wins, it is almost certain the government won’t be able to ignore crypto anymore.
New regulations for digital assets are being sought after by regulators amid the FTX collapse. The government is currently testing a digital dollar, which could be widely adopted. However, regulations are asked for the crypto space as FTX contagion caused too much noise and pain.
Republicans gain control
“Republicans won 218 seats and gained the majority in the House, while Democrats had 210. The party will govern the chamber with a thin margin after an expected red wave failed to materialize,” Bloomberg reported.
The change in the balance of power will have an impact on discussions about new regulations for digital assets, giving Republicans more clout in Congress to shape legislation regarding stablecoins. They also have greater influence and oversight of the spot market for cryptocurrencies, as well as the ability to exert more pressure on regulators.
However, any legislation will need to get support from both parties in order to pass because of the divided control of Congress, the Senate’s rules, and the prolonged Democratic control of the White House and Senate.
Patrick McHenry, a Republican from North Carolina, will preside over the House Financial Services Committee. The Republican from North Carolina has worked with his Democratic counterpart, current Committee Chair Maxine Waters, D-Calif, to develop a new legislative framework on stablecoins.
Waters is a long-time pioneer on fintech policy concerns, spanning from crowdfunding to cryptocurrency. The two also announced a hearing on the FTX crash and its extensive effects on digital assets.
McHenry told reporters that digital asset legislation would be a top priority under his leadership. While cryptocurrencies existed in the shadows for years, now they even got the attention of governments.
Cryptocurrencies were and still probably are the wild west of finances, but it could soon change with Republicans in the House. For better or worse, regulations and legislation are needed after so many debacles that happened this year.