U.S. crypto lobbyists are experiencing a wave of optimism as recent legislative votes confirm the growing support for the cryptocurrency industry among lawmakers. Just a few years ago, crypto was often viewed with skepticism and pariah status, but the political landscape has shifted significantly, with substantial allies emerging in the White House and within U.S. financial agencies.
The recent votes in both the Senate and House of Representatives aimed at repealing an Internal Revenue Service (IRS) rule that sought to regulate decentralized finance (DeFi) projects as brokers demonstrate a remarkable bipartisan commitment to supporting the crypto sector. A notable majority of Democrats joined their Republican counterparts to challenge the IRS’s directive, indicating a deeper-than-expected consensus on crypto-related issues. Democratic support among lawmakers has exceeded expectations, suggesting a willingness to negotiate without sacrificing core interests in future legislation.
Under former President Joe Biden’s administration, the IRS finalized a rule that imposed rigorous tax reporting requirements on DeFi projects. However, the House and Senate successfully voted to overturn this rule via the Congressional Review Act, garnering overwhelming support—19 Democrats in the Senate and 76 in the House broke ranks with their party’s administration to align with the industry’s interests.
As a result of this notable support, advocates within the crypto community express optimism about future legislative discussions. Kristin Smith, CEO of the Blockchain Association, emphasized a shift from defense to offense, stating, “For years, we’ve been playing defense—trying to protect the industry from hostile regulators. But now we’re able to think a bit more expansively about what’s possible at the federal level.” This repositioning could pave the way for constructive dialogue surrounding critical legislative matters.
One of the most pressing topics on the legislative agenda is the regulation of U.S. stablecoin issuers. With both chambers of Congress closely reviewing proposed bills, the collaboration between Democrats and Republicans could signal a promising future for crypto legislation. The potential passage of these bills would highlight crypto as a rare issue garnering bipartisan support during a time of increasing political polarization.
Looking ahead, the industry’s ambition lies in establishing a clear regulatory framework governing cryptocurrency trading and transactions. Legislating on this front would provide clarity and stability, alleviating the confusion created by federal agencies attempting to adapt existing laws to fit the evolving crypto landscape.
The Financial Innovation and Technology for the 21st Century Act (FIT21) serves as an important precedent, having passed the House in a previous session, which offers a blueprint for future efforts. While further progress on this bill may take time, the groundwork already laid, coupled with growing bipartisan support, enhances its prospects for success.
The dynamic nature of cryptocurrency’s presence in Congressional discussions is emblematic of a broader trend. A shift in public sentiment, fueled by heightened awareness and interest in crypto, has empowered lawmakers to act. The Fairshake political action committee, which invested approximately $139 million in pro-crypto candidates in the 2024 elections, signals that those who advocate for positive change within the crypto space are committed to this political strategy.
The successful votes against the IRS rule exemplify the tangible results of this strategy, as pro-crypto candidates leverage their position to drive meaningful policy progress. With deep financial backing from significant industry players, it’s evident that supporting a balanced regulatory environment offers considerable political benefits.
As legislators continue to navigate the intricacies of crypto policies, collaboration and bipartisan support will be essential for shaping the future regulatory landscape. This era of pro-crypto advocacy showcases an evolving narrative, where stakeholders—lawmakers and industry players alike—recognize the potential benefits of smart regulation and innovation in this burgeoning market.
