Ray Dalio: 2026 Midterms Could Weaken Trump, Delay Crypto Rules
The balance of power in the United States Congress could shift toward Democrats in the 2026 midterm elections amid heightened concerns over inflation and affordability, potentially reversing elements of President Donald Trump’s policy and regulatory agenda, according to billionaire hedge fund manager Ray Dalio.
“The affordability issue will probably be the number one political issue next year, contributing to the Republicans losing the House and a very messy 2027 on the way to a very interesting 2028 election,” Dalio said, adding: “Because of how our democracy works, President Trump has a two-year unimpeded mandate that can be weakened greatly in the 2026 mid-term elections and reversed in the 2028 elections. Nowadays, it is rare for one party to be able to stay in power for long.”
The digital asset sector has been among the notable beneficiaries of the administration’s technology-focused agenda emphasizing digital innovation and artificial intelligence. A change in control could jeopardize the pro-crypto regulatory momentum in the United States before key measures, including the CLARITY market structure bill, are enacted.
CLARITY Act potentially deferred to 2027 as Democrats aim to retake the House
The CLARITY market structure bill may be postponed until 2027, with some Democratic lawmakers anticipating a shift in the 2026 midterms and delaying a vote until after the elections, according to investment bank TD Cowen.
Republicans currently maintain a narrow five-seat majority in the House of Representatives.
The Democratic Party has about a 78% chance of taking control of the House in November, according to traders on prediction market Polymarket.
In 2024, Joe Doll, general counsel at non-fungible token (NFT) marketplace Magic Eden, said the president, his administration, and pro-crypto lawmakers had a two-year window to advance crypto regulation. “The House majority is a real slim margin, and it probably flips because it almost always flips. So you could have a divided government that gets things locked up and frozen in two years,” Doll said.
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