Crypto’s Future in 2026 Depends on Regulatory Power Struggles During the Midterm Elections

Shifting U.S. Crypto Regulations Amid Political Mobilization

The landscape for digital assets in the United States is on the verge of significant transformation, as both political figures and industry leaders ramp up their efforts to clarify regulatory guidelines. With the 2026 midterm elections drawing closer, organizations advocating for cryptocurrency are stepping up to influence candidates’ perspectives on digital asset regulation. This marks a deepening connection between the world of politics and the crypto industry.

One notable group, Stand With Crypto, has initiated a survey directed at state and federal candidates to gauge their views on topics such as blockchain innovation, banking access, and consumer safeguards. The organization plans to assign grades from A to F to politicians, utilizing its vast network of 2.6 million supporters to impact key electoral races. This proactive approach demonstrates the sector’s awareness that the next Congress could play a decisive role in shaping the future of crypto-friendly legislation in the U.S.

Building on substantial political contributions in recent years—including $24 million funneled through super PACs in 2024—the crypto industry’s advocacy efforts are intensifying. Stand With Crypto’s political action committee, backed by Coinbase, has already started evaluating lawmakers based on their voting records and policy initiatives, further establishing the industry’s influence in Washington.

Despite these efforts, progress on crypto-related legislation in the capital remains uneven. While some bills addressing stablecoin regulation and digital asset classification have advanced, their momentum has been hindered by government shutdowns and shifting legislative priorities. The results of the 2026 midterms could prove pivotal in determining whether these regulatory initiatives move forward, especially as the industry seeks a unified framework to compete globally.

Global Developments in DeFi and Regulatory Innovation

On the international stage, the decentralized finance (DeFi) sector is rapidly enhancing its infrastructure, with notable advancements in countries like Canada and the United Arab Emirates. In Toronto, Stablecorp’s QCAD stablecoin has become the first Canadian dollar-backed digital currency to achieve regulatory compliance after years of review. Meanwhile, Abu Dhabi’s financial authorities have granted approval for Ripple’s RLUSD stablecoin for institutional use, highlighting the Middle East’s increasing involvement in digital asset adoption. These achievements illustrate a global trend toward regulatory experimentation, as various regions seek to balance technological progress with effective oversight.

Institutional Growth and DeFi’s Maturing Ecosystem

Institutional participation in DeFi is also gaining momentum. DWF Labs, a prominent market maker, has pledged $75 million to support projects aimed at expanding decentralized finance for institutional clients, focusing on innovations such as dark-pool perpetual decentralized exchanges and yield-generating assets. Additionally, Mutuum Finance (MUTM) is preparing to launch its decentralized lending platform, with a comprehensive security audit by Halborn scheduled before its expected release in the fourth quarter of 2025. These initiatives signal DeFi’s transition from speculative ventures to practical financial infrastructure, though challenges related to scalability and regulatory adherence persist.

Looking Ahead: Policy and Innovation at a Crossroads

The ongoing interplay between political advocacy and technological advancement underscores the crypto sector’s dependence on both supportive regulation and continued innovation. As U.S. legislators debate the future of digital asset laws, industry participants are intensifying their lobbying efforts and accelerating product development to maintain America’s edge in the global digital economy. The upcoming months will reveal whether this convergence of political and technological momentum can deliver much-needed regulatory clarity—or if further uncertainty lies ahead.