Voters Polled on Digital Assets – 13% and Rising Own Crypto

A US survey delegated by the Crypto Council for Innovation found that 52% of voters wanted to see more crypto regulation, with a third of respondents regarding crypto as an important financial innovation.

US Voters Want to See More Crypto Regulation

More than half of US voters believe that cryptocurrencies need more regulation, according to a nationwide poll conducted by the Crypto Council for Innovation, a crypto-oriented alliance backed by companies like Coinbase, Fidelity Digital Assets, Block Inc, Gemini, and Paradigm.

The US survey involved about 1,200 potential voters. It was delegated by the Crypto Council and conducted by a bipartisan team from October 8 to 10, 2022.

About 13% of respondents said they held some form of cryptocurrency. This shows that cryptos have penetrated financial markets and are here to stay. When it comes to other asset holdings, 16% of surveyed voters said that they held stocks, 12% held mutual funds, 8% owned precious metals, and only 5% held bonds.

52% of respondents would like to see more crypto regulation versus only 7% who believe the industry is overregulated. 20% of respondents said that the crypto industry was already regulated enough. The latter group included the most crypto holders, with 45% of them owning cryptocurrency. Of those who want to see more regulation, 28% own cryptocurrency.

Interestingly, 45% of the polled voters want lawmakers to treat crypto as a ‘serious and valid part of the economy versus 36% who want regulators to treat it as a mechanism for fraud.

When developing crypto regulations, 58% of voters want politicians to focus on market stability and fraud detection.

One in three voters believes that cryptocurrencies are an important financial innovation and a similar percentage considers it to be the future of finance. About one in four respondents agree with the statement that crypto is used for crime versus a similar percentage who disagrees with it. A similar distribution of voters agrees and disagrees with the statement that crypto is used for tax evasion.

Crypto Holders to Have a Say in Midterm Elections

One of the most important conclusions that we can draw from the report is that crypto has become a major topic in the United States.  A significant group of voters will likely think twice before voting for politicians who are openly against the industry. This means that crypto holders might have an impact amid midterm elections scheduled for November.

Specifically, 20% of respondents said that they were more likely to vote for a crypto-friendly politician, although almost 30% of voters said they were less likely to support such candidates in the upcoming elections. Interestingly, more support for crypto comes from key demographics, such as young voters as well as Latino and Black voters. For example, 38% of Latino voters would back a crypto-friendly politician and 30% of Black voters would do so.

New poll out today: 1 in 7 voters hold #crypto – and say they are ready to vote for pro-crypto candidates.

Could crypto play an important role in the upcoming midterm elections? Let's dive in ⬇️https://t.co/cMkYiqRUuM

— Crypto Council for Innovation (@crypto_council) October 26, 2022

Former US Senator Cory Gardner (R-Colorado), who is currently the Chief Strategist of Political Affairs at the Crypto Council, stated:

“Ballots are going out across the country – election day is just a few weeks away.  This election promises some of the most competitive races in a generation, with many races likely to be decided by narrow margins. The crypto community is ready to make its voice heard in November – those candidates that listen will get their vote.”

He added that the survey suggested voters believe in the promise of digital assets and consider crypto as part of the economy and their financial future.

“Importantly, they are echoing what the industry has been calling for: regulation that provides clear rules of the road to protect consumers and realize the technology’s full potential,” Gardner added.

Washington Calls for More Regulation

Not only regular voters want to see more oversight from financial watchdogs. The US government is also calling for tighter regulation. Earlier in October, the Financial Stability Oversight Council (FSOC) – a federal panel responsible for monitoring financial system risks – issued an extensive report about the risks posed by the cryptocurrency market. The report says that the widespread adoption of cryptocurrencies poses major risks if the industry continues to expand without better oversight.

It’s the first major crypto-oriented report released by the FSOC, a panel led by the US Treasury Department and created after the 2008 financial crisis to support the government in identifying and addressing threats to the financial system.

The report has been delegated in March of this year by the Treasury in response to Section 6 of President Joe Biden’s executive order on “Ensuring Responsible Development of Digital Assets.”

FSOC concluded that “crypto-asset activities could pose risks to the stability of the US financial system if their interconnections with the traditional financial system or their overall scale were to grow without adherence to or being paired with appropriate regulation, including enforcement of the existing regulatory structure.”

The panel admits that cryptocurrency activities have increased significantly in recent years, although the interconnections with traditional finance were relatively limited. FSOC said that existing laws were already covering many activities in crypto markets, although there are some gaps that have to be addressed. The report recommends that all regulators, including the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), prioritize crypto enforcement.

The FSOC report puts a special emphasis on stablecoins, arguing that they pose risks to the broader financial system. Stablecoin issuers are currently overseen by state regulators, and this group of cryptocurrencies is a key bridge between the emerging crypto industry and traditional markets. This means that increased volatility in crypto may affect wider markets if the bond between the two gets stronger.

Besides the report, the FSOC members held a meeting on October 3. Treasury head, Janet Yellen, former chairman of the Federal Reserve, delivered a speech, saying:

“Digital assets have grown significantly in scale and scope over recent years. They have attracted a large amount of capital and interest from both retail and institutional investors. At the same time, we have seen very significant shocks and volatility within the crypto-assets system, particularly over the last year. With the potential for this kind of instability in mind, at our February meeting, the Council named digital assets as one of its key priorities for the year.”

The US Congress and regulators are more decided than ever to tighten the oversight on crypto, especially after the European Union (EU) green-lighted the final text of the Markets in Crypto Assets Regulation (MiCA) on October 5.