(Kitco News) – Cryptocurrency proponents are increasingly looking to make their voices heard in the political realm and are using a well-known fundraising strategy to achieve their goal: super PACs.
According to a report from Public Citizen, large crypto industry political action committees (PACs) have raised $102 million to spend on the 2024 Congressional elections.
Only two other super PACs have raised more money so far this cycle, highlighting the rising stature of the crypto lobby following the launch of the first spot Bitcoin exchange-traded funds (ETFs) in the U.S.
“During the 2022 midterm elections, then-FTX CEO and now-convicted felon Sam Bankman-Fried personified the cryptocurrency sector’s attempt to use campaign spending to maximize its political influence,” said Rick Claypool, research director for Public Citizen and author of the report. “Now a fresh crop of crypto corporations, execs, and their allies are back in the political fray, spending millions to tilt elections toward pro-crypto candidates and against attempts to hold the industry accountable and ensure it follows the law.”
The report shows that more than half of the funds raised came directly from corporations, primarily Coinbase and Ripple Labs, who were unencumbered by donation limits as corporations have no limits when it comes to political spending thanks to the Supreme Court’s decision on Citizens United.
Other contributors include billionaire crypto execs and venture capitalists, with each founder of venture capital firm Andreessen Horowitz donating $11 million, the Winklevoss twins (Gemini) throwing $5 million into the pot, and Coinbase CEO Brian Armstrong pledging $1 million.
Notably, “four of the eight corporate crypto super PAC donors have either settled or are facing charges by the U.S. Securities and Exchange Commission (SEC) for alleged violations of securities laws,” Public Citizen said.
Thus far, crypto-supported candidates have seen success as only one of the six candidates in already-completed 2024 primaries that received support from crypto super PACs lost their race.
“Just as Big Oil tries to thwart climate regulations and insurance companies try to thwart health care reforms, the crypto sector’s political spending is intended to stop enforcement crackdowns, block regulation that prevents fraud, and defeat candidates who support either,” Claypool said.
The months ahead will see 11 more candidates backed by Fairshake and its affiliates compete in primary elections, “including Republican Senate candidates Jim Justice in West Virginia and Jim Banks in Indiana, each of which has received over $3 million in support from Defend American Jobs, the Republican crypto super PAC,” the report said.
“The crypto super PACs have pledged to spend in general election Senate races in the battleground states of Ohio and Montana,” where Democrats Sherrod Brown and Jon Tester are seeking reelection, the report noted.
Brown and Tester both sit on the Senate Banking Committee and have been critical of cryptocurrency and its use by ‘bad actors’ such as Hamas and North Korea’s Lazarus Group.
“The narrow majorities in both chambers of Congress mean the crypto sector’s outsized influence in a small number of House and Senate races has the potential to tip control of Congress toward one party or the other,” Public Citizen said.
