Nearly $100 million in "cash power": How crypto backers are shaping the U.S. election
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Nearly $100 million in "cash power": How crypto backers are shaping the U.S. election
Crypto billionaires are providing substantial support and funding for the U.S. election.
Navigating Web3 tides with focused insightsSource: Bloomberg
Translation: BitpushNews Mary Liu
A cryptocurrency lobbying group is sending a message to U.S. political candidates: side with us, or risk losing your election.
Last week’s defeat of Democratic Representative Katie Porter in California’s Senate primary serves as an example.
Well-funded players from the crypto industry spent $10 million on advertising and campaigning efforts to block Porter's Senate bid, clearing a clearer path for her fellow Democrat Adam Schiff—widely seen as more crypto-friendly—to take office in November.
Crypto billionaires are pouring significant support and funding into the U.S. elections.
The pro-crypto super Political Action Committee (PAC) Fairshake has amassed approximately $75 million for use in U.S. elections.
Supporters include Coinbase CEO Brian Armstrong, digital asset exchange Gemini founders Cameron Winklevoss and Tyler Winklevoss, and a16z co-founder Marc Andreessen.
Crypto advocates acknowledge that their chances of defeating one of the industry’s harshest critics, veteran Senator Elizabeth Warren—who is running for re-election this year in a relatively safe seat—are slim. However, they plan to use Porter’s defeat as leverage to pressure Warren’s more vulnerable Democratic allies.
Kristin Smith, CEO of the Blockchain Association, a trade organization representing the crypto industry, said in an interview that working with Warren “will make your election significantly harder.”
Smith’s team says one candidate they’re watching closely is Senator Sherrod Brown, the Ohio Democrat and chairman of the Senate Banking Committee who has been at the forefront of lawmakers pushing for stricter regulations on cryptocurrencies.
Regarding Brown, Smith said: “What action he will take on crypto for the rest of this year remains an open question—if any.”
A spokesperson for Senator Brown’s campaign declined to comment.
New Legislation
The crypto industry is focused on legislative proposals aimed at combating illegal finance. Two main bills are under scrutiny: one backed by Senator Warren and Republican Senator Roger Marshall, and another proposed by Senators Mark Warner, Jack Reed, Mitt Romney, and Mike Rounds, which would apply existing anti-money laundering rules from banks and other financial institutions to crypto firms.
Criminal networks use cryptocurrencies to move illicit funds and employ tools to make transactions more anonymous.
Groups like the Blockchain Association and the Digital Chamber of Commerce argue that these current bills impose unworkable requirements and could stifle innovation in the crypto sector.
This assertive political stance marks a notable shift from just a year ago, when a series of scandals and business failures triggered a credibility crisis for the crypto industry, culminating in the criminal conviction of its once high-profile figure Sam Bankman-Fried (SBF).
After regulatory scrutiny and persistent challenges in turning the technology into practical applications, much of the earlier optimism around crypto now appears illusory, as regulators continue broad crackdowns across the industry.
Democratic Congressman Brad Sherman of the House Financial Services Committee, who frequently questions the utility of cryptocurrencies, said the industry’s influence on elections may be overstated—but lawmakers won’t ignore its ability to spend millions in campaigns.
In an interview, he said: “Whether they actually have decisive impact might matter less than the fact that they fired millions of dollars at 430-some members of Congress, none of whom were involved in those races.”
Super Tuesday represents the first major test for the Fairshake super PAC.
Spokesperson Josh Vlasto said key upcoming races may include Democratic Senate primaries in Michigan and Maryland—seats currently held by retiring senators Debbie Stabenow and Ben Cardin—as well as Senator Jon Tester’s race in Montana, where he chairs the Senate Banking Committee.
ETF Turning Point
The crypto market is rebounding, largely due to the U.S. Securities and Exchange Commission (SEC) approving spot Bitcoin ETFs in January—a decision that granted greater legitimacy to the crypto industry.
It hasn't been easy to fully shake off the fallout from a string of business failures in 2022, which led to the collapse of one of the industry’s most prominent companies, FTX. The firm’s co-founder, SBF, was convicted last year of defrauding customers and is currently awaiting sentencing.
As lawmakers consider a range of market regulation bills—including measures targeting illicit finance and regulating stablecoins, crypto tokens pegged to assets like the U.S. dollar—other industry participants are left rebuilding relationships on Capitol Hill, knowing new rules could fundamentally reshape how businesses operate if adopted.
Meanwhile, the industry is watching whether the SEC will approve ETFs tracking Ethereum, the world’s second-largest cryptocurrency.
Critics remain skeptical about the industry’s actual ability to influence elections. They point out that some TV ads funded by crypto-related PACs before Super Tuesday deliberately avoided mentioning cryptocurrency, instead focusing on hot-button issues such as abortion rights and gun safety in messaging supporting Democratic candidates, or advocating tax cuts and inflation control for Republicans.
Dennis Kelleher, president and CEO of Better Markets, an organization advocating for stronger financial regulation, said: “They know public opinion on crypto is like kryptonite—it turns off more voters than it excites. But you can bet that wherever the crypto industry shows up and spends money, they’ll claim credit for election outcomes and expect returns on their investment.”
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