In Washington, President Donald Trump’s foray into the cryptocurrency world, including hosting exclusive dinners with top investors, has sparked a fierce backlash from Democrats, who denounce it as overt corruption from the White House. However, the Democratic Party itself faces a complex relationship with the burgeoning crypto industry.
While efforts to regulate cryptocurrency in the Senate, led by Republicans, have received some Democratic support, these endeavors have also illuminated disagreements within the party. Many Democrats insist that any new regulations should explicitly prevent President Trump and his family from profiting from cryptocurrency.
“Regulating crypto is essential,” says Senator Chris Murphy from Connecticut, “but we can’t ignore the way President Trump is leveraging cryptocurrency to enable his corruption while we legislate.”
The legislation is advancing at a pace unusual for Congress in the context of such an emerging industry. The influx of significant contributions from cryptocurrency firms has rendered them a potent force in politics, drawing allies and increasing scrutiny among lawmakers.
A snapshot of the crypto industry’s influence is evident from the 2024 elections. Fairshake, a crypto-centric political action committee, along with affiliated PACs, invested over $130 million in congressional races. Notably, Fairshake expended roughly $40 million to support Republican Bernie Moreno in Ohio, aiming to oust Democratic Senator Sherrod Brown, a vocal critic of the industry and chair of the Senate Banking Committee.
“Washington got a loud message that opposing crypto isn’t wise if one intends to maintain a political career,” declared Brian Armstrong, Coinbase’s CEO, after the 2024 election.
Coinbase—a major crypto exchange in the U.S. and top contributor to Fairshake—does not see backing for the industry as a partisan issue, according to Kara Calvert, the firm’s vice president of U.S. policy. Simultaneously, the industry backed Democrats Ruben Gallego and Elissa Slotkin in their pursuit of Senate seats in key states.
In Michigan, Fairshake invested $10 million to support Slotkin, who narrowly defeated Republican Mike Rogers. Slotkin, who championed cryptocurrency on the campaign trail, opted not to give interviews.
As the landscape evolves, similar tactics are predicted for the 2026 elections, where Fairshake has already accumulated $116 million to influence the midterm races.
“The crypto sector is on the map and growing its clout in Washington,” Calvert noted.
Amid this, Democrats navigate a landscape complicated by President Trump’s deep ties to crypto. Sixteen Democrats joined Republicans to advance the GENIUS Act, aimed at establishing regulatory frameworks for stablecoins—a cryptocurrency typically pegged to the U.S. dollar—to introduce consumer protections and industry legitimacy.
For many Democrats, a sticking point is the bill’s exclusion of the president from restrictions designed to stop Congress members and their families from profiting from stablecoins. Once skeptical of cryptocurrency, Trump has pledged to make the U.S. a global crypto hub in his next term, with his family heavily involved in the industry, whether through mining, major bitcoin purchases, or other ventures.
In early May, following revelations about Trump’s crypto interests, Senate Minority Leader Chuck Schumer urged Democrats to oppose the bill, seeking stronger negotiation grounds.
Subsequently, a Democratic bloc that initially backed the GENIUS Act switched their stance, halting the bill. Negotiations ensued between Senate Democrats and Republicans, with White House engagement noted.
The current iteration of the bill is anticipated to pass the Senate this month, with potential amendments. One amendment by Democratic Senator Jeff Merkley—co-sponsored by Schumer—proposes barring presidential profits from stablecoins, though it’s unlikely to succeed.
“Improvement is possible for legislation, as it is for much else, but we face issues with the president,” remarked Senator Mark Kelly of Arizona. “Yet, this represents collaboration between Democrats and Republicans, resulting in a compromise. This version will likely proceed.”
Despite bipartisan efforts, the bill has sown discord. Schumer, opposing the legislation, acknowledged division within his caucus.
“This bill contains a glaring flaw,” noted Senator Murphy. “If enacted, it would render it illegal for me to create a cryptocurrency, while leaving the president’s hands free.”
Looking forward, should the Senate approve the stablecoin bill, it must still pass the House and reach the president’s desk.
Crypto advocates emphasize the significance of advancing beyond stablecoin regulation to broader market structure legislation.
“Stablecoin regulation is just the onset. Market structure reforms follow,” Calvert expressed optimism for swift Senate collaboration.
Some Democrats view the bill as an opportunity to establish fundamental safeguards for an industry experiencing explosive growth, particularly among demographic groups that have moved away from the party recently.