Bitcoin
$160M Bitcoin War Chest Could Ruin Democrats in November
Several of the world’s largest cryptocurrency companies organized a political war chest of more than 160 million dollars they plan to invest this year in support of candidates who defend “light” industrial regulations – and Republicans stand to benefit most, experts tell the Post.
Cryptocurrency companies’ spending on lobbying and government relations reached a new high of $24.7 million in 2023, according to the Securities and Exchange Commission.
Another $5.6 million has already been spent in the first quarter of 2024 – an amount that is expected to more than quintuple by November.
The two biggest spenders are Coin basea popular crypto exchange platform, and the Blockchain Association, a nonprofit organization that lobbies legislators at the state and federal levels.
Many of the world’s largest cryptocurrency companies have organized a political war chest. REUTERS
A campaign fund of this size makes crypto one of the most influential players this election cycle.
Former President Donald “Trump’s acceptance and embrace of cryptography stands in stark contrast to the overwhelmingly regressive approach to cryptography taken by the Biden administration and the Democratic Party in general, which has consistently attacked the industry, in most cases unfairly,” Edward Wilson , an analyst at blockchain firm Nansen, told The Post.
“The issue of encryption is likely to influence and could even influence the elections. This is because many US-based crypto supporters place crypto as a fundamental issue for them and are fed up with the approach of chasing good players in the space like Coinbase and Uniswap while blocking access to products and airdrops, while other countries prosper, taking industry abroad with them. Based on this, it is likely that Republicans will receive significantly more in crypto donations – but it is difficult to determine how much – than Democrats.”
This could be extremely bad news for Democrats like current Senator Sherrod Brown of Ohio, who has repeatedly challenged the ethics and effectiveness of crypto companies and cryptocurrencies in general. (Brown’s campaign did not respond to The Post’s request for comment.)
“Our founders would have been bitcoiners,” said Brown’s Republican opponent, Ohio businessman Bernie Moreno. “They believed in decentralization of power and control. That’s what it is. [Brown] I laughed about it, but I take it very seriously.”
Moreno already owned his own blockchain company and says Ohio has “a lot of” crypto “farmers” that his government should also consider.
“Encryption represents freedom, and philosophically what lawmakers like Brown and Democrats believe is that they should have control,” Moreno told the Post. “They would prefer to have control over schools, jobs and, of course, the currency. . . . They hate encryption in their hearts because they want to be in control. We disagree.”
When asked whether Democrats could turn things around and find more support in the cryptocurrency industry before polls open, Moreno was not optimistic.
“The energy of the Democratic Party is controlled by extremists like Brown and Elizabeth Warren,” Moreno said. “Word has gotten out to the industry that if they are given four or more years of control, crypto in America will be completely dead.”
But not everyone is convinced that cryptography will be able to reach political dominance in America.
“The cryptocurrency industry has become much more involved in politics in just the last few years, from lobbying efforts to campaign donations,” said University of Dayton political scientist Christopher Devine. “But it’s unclear whether encryption will be successful in influencing elections across the country or in tight races involving powerful members of Congress, like Sherrod Brown’s battle for re-election in Ohio.”
One thing that can slow them down, according to Devine, is a lack of focus.
“It is important to note that the cryptocurrency industry donated equally to both parties in 2022,” he told the Post. “Their goals are not particularly partisan or ideological. They want to curry favor with whichever candidate is most likely to win a seat in the next Congress and potentially be able to vote on legislation that affects their industry.”
Jason Allegrante, chief legal and compliance officer at crypto firm Fireblocks, agrees – to a point.
“Blockchain is first and foremost a technology – and the development of this technology transcends political parties. What is notable about the industry’s positioning in this election cycle is that it will continue to prioritize the cause of innovation first, even as it returns to electoral politics. Republicans may benefit most this November simply because many already seem to understand the issues. But all candidates, regardless of party, will have the opportunity to defend crypto or test an anti-crypto stance with the American electorate,” he told the Post.
Right now, the industry appears to be determining whether men like Brown and Moreno are the outliers of their parties when it comes to cryptography or the exemplars. Simply put: he wants to make friends.
And the Republican Party seems very friendly.