Crypto Chaos on Capitol Hill: Partisan Split Deepens Over Trump’s Digital Asset Ties

A group of democrat lawmakers, led by Representative Maxine Waters, have walked out of a joint hearing to discuss crypto regulation over growing concerns around the Trump family’s involvement in the crypto industry.Waters raised concerns Republicans are working to legitimise what she sees as Trump’s effort to monetise the presidency through crypto at the expense of regular investors.The walkout comes after Trump’s announcement Monday of a second crypto-focussed private dinner, to be hosted in Washington by the Trump Super PAC, MAGA Inc.The partisan divide over cryptocurrency regulation in the US deepened on Tuesday after some Democratic lawmakers boycotted a joint hearing hosted by the House Financial Services and Agriculture Committees.A group of Democrats — led by the ranking Democrat on the House Financial Services Committee, Representative Maxine Waters of California — objected and walked out of the hearing, opting instead to hold their own separate discussions on crypto regulation.The split between the two parties hinged largely on Donald Trump and his family’s increasing involvement with the crypto industry and their simultaneous effort to influence the industry’s regulation. Waters described the US President’s involvement with crypto as “Trump’s crypto corruption and conflicts of interes”. I am deeply concerned that Republicans aren’t just ignoring Trump’s corruption, they are legitimizing Trump’s and his family’s efforts to enrich themselves on the backs of average Americans. Maxine Waters, Democrat Congress Representative The Republican Chair of the House Financial Service Committee, French Hill said Waters had “thrown partisanship into what has historically been a strong, good working bipartisan relationship”.The bickering wasn’t just confined to the hearing rooms, spilling out onto social media. The Republican-led House Committee of Agriculture took shots at Waters and her supporters on X / Twitter, posting that while she “rushed out the door, adults remain in the room”. The account also shared a video of her blowing a kiss to FTX founder Sam Bankman-Fried.Despite the boycott by some Democrats the Republicans continued with their roundtable.Related: Trump Dodges Questions on Memecoin Profits Amid Price PlungeTrump’s links to crypto have raised eyebrows ever since he launched his own memecoin, $TRUMP, just days before his inauguration in January. Recently the $TRUMP website announced the top 220 holders of the token will be invited to dine privately with the president on May 22, triggering a price surge and prompting Democrat senators to call for an “urgent inquiry” into Trump’s crypto ventures.On Monday Trump announced a second crypto-centric dinner event, the so-called “Crypto & AI Innovators Dinner” to be held later this month in Washington. The event will be hosted by the Super PAC, MAGA Inc., which in the past has raised funds for Trump’s election campaigns. Since Trump can’t run for a third term, it’s unclear how funds raised from the dinner would be used. Tickets to the event are reported to cost US$1.5 million (AU$2.3 million).Democrats Discuss Trump Crypto CorruptionThe Democrats’ discussions focussed on establishing ethical guidelines to prevent conflict of interest and ethics concerns around the ownership and use of cryptocurrencies by government officials.Senator Sean Casten and Representative Sylvia Garcia pointed to the double standards that allow Trump and his family to personally profit from cryptocurrencies to the tune of hundreds of millions of dollars, while other government officials must go as far as removing labels from their water bottles to avoid a perceived conflict of interest.Following the meeting, Democrat members of the House Financial Services Committee posted draft legislation to their website that aims to “establish certain digital asset prohibitions with respect to Government officers and employees, and for other purposes”.There was also some discussion of how government agencies could proceed with broader regulation of the crypto industry, with former chair of the Commodity Futures Trading Commission (CFTC) Timothy Massad, suggesting the Securities and Exchange Commission (SEC) and CFTC could cooperate to create a “self-regulatory organization”. Massad said: It’s a way of establishing jurisdiction over this market without rewriting the securities laws, without undermining the authority of the SEC or the CFTC and it brings those two agencies together, which I think is very important. Timothy Massad, former chair of the CFTC Waters agreed that it’s possible that cryptocurrencies could be defined as part commodity, part security, saying “I think there’s some things we can do.” She added, “What I cannot work out is Trump’s corruption.” Related: FIT21 Crypto Bill Passes US House with Bipartisan Support, Will President Biden Veto?The Republican meeting didn’t discuss Trump’s involvement with crypto at length, instead focussing on the future of crypto regulation more generally and calling for bipartisan cooperation. Long-time crypto supporter and republican member of the House Financial Services Committee, Representative French Hill referenced Democratic support in passing past crypto legislation and called on continued cooperation to fully regulate the crypto industry: We’re approaching it in a fresh way and this roundtable is essential to getting new views on how to go in a different direction...to my friends on the other side of the aisle, our doors are always open. French Hill, Republican Representative The post Crypto Chaos on Capitol Hill: Partisan Split Deepens Over Trump’s Digital Asset Ties appeared first on Crypto News Australia.