KEY POINTS
- Hougan noted efforts over the years may be paying off, as seen with the anti-SAB 121 bill's Congress passage
- House members also passed FIT21 last month with surprising support from 71 Democrats
- Hougan believes the market would be at new all-time highs if people understood the impact of last month's changes
The U.S. government appears to have been changing its attitude toward the cryptocurrency industry in the past month, and while some within the sector have probably started noticing subtle changes, the chief investment officer of crypto manager Bitwise Asset Management believes the wider market has yet to recognize the shifting tone.
Matt Hougan wrote in a blog post Tuesday that "crypto has been building political muscle in recent years," and it now "appears that effort has paid off."
The payoff has been made apparent by both the House and Senate passing a resolution to repeal the highly controversial crypto custody SAB 121 accounting bulletin of the U.S. Securities and Exchange Commission (SEC) last month.
However, the biggest shift was seen when a staggering 71 Democrats joined over 200 Republican House members to vote in favor of the Financial Innovation and Technology for the 21st Century Act (FIT21), which could establish a regulatory framework for the digital assets space.
A significant number of GOP lawmakers have already been warming up to the crypto sector in the past few years, but the growing support of Democrats for the booming industry is further proof that Washington is gradually turning toward digital assets.
"But here's the thing: if people understood the ramifications of the shift in D.C., the crypto market would be at new all-time highs," Hougan pointed out.
"If you think BlackRock's move into the crypto space positively impacted the market, imagine if all of Wall Street accepted crypto as a normal part of the market. Talk about mainstream. The market will wake up to the fact that we are in a new era for crypto, and when it does, I suspect it will move the industry towards all-time highs," he added.
Hougan's statements appear to mirror the price movements of Bitcoin, the world's largest digital asset. Following the political breakthrough in the House over the SAB 121 resolution, the coin's price didn't move much. There weren't a lot of social media posts about the development either, further cementing Hougan's observation that not many in the crypto market have acknowledged Washington's shift.
He acknowledged the fact that the industry has a long way to go before reaching a state wherein Wall Street recognizes crypto as a normal part of the financial system, but the recent developments could have at least affected the market.
Such a pale reception toward the political reversals in the last month may be associated with the uncertainty surrounding the crypto sector ahead of this year's elections. U.S. President Joe Biden vetoed the SAB 121 resolution, and the Senate has yet to vote on FIT21.
