There is said to be a significant change in the Democratic Party's stance on cryptocurrency, especially Ethereum ETFs. According to Galaxy Digital CEO Mike Novogratz, this change has completely turned the Ethereum ETF world upside down.
“I feel like someone from the Biden White House called and said, 'Guys, we can't be the anti-crypto side anymore,'” Novogratz told CNBC. said. This announcement comes after months of silence from the Securities and Exchange Commission (SEC), which is now frantically communicating with potential ETF issuers, including Galaxy Digital, to get the products ready before a key May 23 deadline.
Rumors of this step back have already had a significant impact on the market, with Ethereum rising 20% since the news first emerged. Novogratz believes that if the SEC's change of heart is politically motivated, “this is a seismic shift” and “prices will be much higher from here.”
While prominent members of the Democratic Party, particularly Massachusetts Senator Elizabeth Warren, have long criticized crypto, Republicans are generally more sympathetic to the sector. The difference in approach has become particularly evident in the past few weeks, with former President Donald Trump, who has historically been skeptical of cryptocurrency, recently stated that he would support the industry if re-elected.
In response, President Joe Biden threatened to veto a proposal to repeal SAB 121, a controversial crypto finance rule, despite bipartisan support. Less than six months before they face each other in the US presidential election, the standoff between the two politicians has “created a ring of fire”, according to Novogratz.
With Trump leading Biden in the polls and crypto companies raising over $150 million to support pro-industry candidates, sometimes in swing states, Novogratz said Democrats' aversion to crypto is becoming less and less plausible.
“It was Elizabeth Warren and a small group of people who literally took the Democrats hostage on this issue,” said Novogratz, adding that Democratic Senate leader Chuck Schumer, who voted for the repeal of SAB 121, probably told Warren “enough, this is getting stupid.” he added.
“There is no reason to make crypto, a technology, a political issue,” Novogratz added.
*This is not investment advice.
