Recent forecasts from Wall Street suggest that the impending midterm elections in November 2026 could significantly delay crucial financial regulations concerning cryptocurrencies until the following year. Jaret Seiberg of TD Cowen highlighted that the political landscape may hinder progress on the Digital Asset Market Structure Act, which is designed to clarify the regulation of digital assets.
The crypto market experienced turbulence due to previous policies under President Donald Trump, yet his expected return to the White House in 2025 has brought a sense of optimism regarding regulatory clarity in the U.S. Trump”s administration has already made strides in this area, notably through an executive order signed in March 2025 that established a strategic Bitcoin (BTC) reserve.
Subsequent regulatory measures included the enactment of the GENIUS Act in July 2025, aimed at overseeing USD-pegged stablecoins. Additionally, the House of Representatives passed two key pieces of legislation: the CBDC Anti-Surveillance State Act and the Digital Asset Market Structure Clarity Act, both in the same month. These moves signal a growing recognition of the importance of a structured approach to digital asset regulation.
However, as the midterm elections approach, there is increasing concern that the legislation may stall. Seiberg noted that Democrats might lack the urgency to advance the bill, particularly if they believe there is a chance of regaining control of the House after the elections. For the Digital Asset Market Structure Act to pass, it will require bipartisan support, including backing from at least seven Democrats, even if all Republicans agree.
A significant point of contention between the parties is the proposed conflict-of-interest language within the bill. Democrats are pushing for provisions that would prevent government officials and their families, including Trump, from owning or managing crypto businesses. Such stipulations are likely to be a sticking point for Trump and his supporters, who may demand that the effective date of these provisions be postponed for several years.
Seiberg emphasized that time may ultimately favor the enactment of the legislation, suggesting that if it passes in 2027 and takes effect in 2029, many current issues could dissipate. The crypto industry will need to navigate these political waters carefully, as the outcomes of the upcoming elections will undoubtedly influence the future of regulatory frameworks.
In conclusion, as the landscape evolves, stakeholders in the cryptocurrency sector must remain vigilant and adaptable. The potential for delays in regulatory clarity could impact investment and innovation within the space, underscoring the importance of staying informed on these developments.
