Democrats Keep the US Senate but Crypto Only Has Eyes for FTX Collapse

After a whirlwind election week dogged by crypto market madness, the industry's regulatory future in the U.S. is in the hands of a divided government.

AccessTimeIconNov 13, 2022 at 5:25 p.m. UTC
Updated Nov 14, 2022 at 5:13 p.m. UTC

Democrats have retained control of the U.S. Senate following the midterm elections. Although a number of pro-crypto candidates from both sides are in, crypto exchange FTX’s fresh collapse will likely spell more regulations for the space.

The result was called on Sunday, five days after the elections were held, with election officials still counting votes for several members of the House of Representatives. It is not yet clear which party will control the lower body of Congress.

It’s also unclear how much the election outcome could sway crypto legislation already in the works, as the laws have had bipartisan support and the key lawmakers behind the initiatives remain in office. The crypto industry made a concerted effort to make its mark on Capitol Hill this year, and a number of proponents from both parties have won their respective races.

But the market could be a wild card.

On the day of the election, Sam Bankman-Fried, founder of FTX, made a surprise announcement on Twitter that rival platform Binance had signed a non-binding letter of intent to acquire FTX. In the days that followed, the deal was scrapped and the once multi-billion dollar exchange filed for bankruptcy on Friday. Over the weekend, FTX and FTX US were hacked with $600 million worth of crypto moved off the exchange.

Crypto prices across the board took a nosedive following the news, with bitcoin price dropping 22% in the last seven days, according to CoinMarketCap data on Sunday.

Bankman-Fried, who said he had spent much of his time talking to lawmakers and regulators in D.C. these last months, may still influence crypto rules, but not in the way he might have intended.

Several key Senators within the Democratic Party have expressed concern over the collapse of crypto exchange FTX, which was led by major election donor Sam Bankman-Fried. Sen. Sherrod Brown, who will continue to chair the Senate Banking Committee, and Sen. Elizabeth Warren, who sits on that committee, have both called for investigations into the exchange.


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Sandali Handagama is a CoinDesk reporter with a focus on crypto regulation and policy. She does not own any crypto.

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