Regulation
Crypto Lobby Targets Congress’ Anti-Regulatory Contingent
This story is excerpted from Specifications, a weekly newsletter featuring expert reporting, analysis and insights from Montana Free Press journalists and editors. Want to see Capitolized in your inbox every Thursday? Sign up here.
It wasn’t long after the 2022 cryptocurrency crash that U.S. Senator Jon Tester summed up the digital currency with no government oversight or Treasury backing this way:
U.S. Senator Jon Tester, D-Montana, in his office in Washington, DC. Credit: John S. Adams / MTFP
“It failed the smell test for me. I couldn’t find anyone who was able to explain to me what’s there besides synthetics, which doesn’t mean anything,” Tester said on Meet the Press on December 11, 2022. The cryptocurrency had started the year strong , but it was exiting 2022 at a quarter of its January value.
“And the problem is that if we regulate it, and I pointed this out to some of the regulators here a week or two ago, if we regulate it, it might give people a chance to think it’s real,” Tester said. “I’m not a regulator and I’m not a financial person who deals with regulation, but I don’t see any reason why these things should exist.”
Still desperate for the legitimacy that comes with regulation, the cryptocurrency lobby is now hitting back at congressional skeptics. AS Bloomberg reported this last week, major cryptocurrency players raised $160 million to target vulnerable lawmakers. Tester, as one of the longest-serving Democrats on the Senate Banking Committee, is a potential target. Committee Chairman Sherrod Brown, an Ohio Democrat, is another.
Federal election records show that crypto political action committee Fairshake spent $10 million opposing Democratic Rep. Katie Porter’s Senate bid in California.
Tester’s recent voting record on cryptocurrencies has been favorable to the sector. In May, Tester joined Republicans, including Montana Sen. Steve Daines, to fight a Securities and Exchange Commission advisory recommending banks record customer-held cryptocurrencies as liabilities and stressing the need to disclose boom risk -bust associated with the value of cryptocurrencies.
As Bloomberg reports, cryptocurrency PACs do business in dollars, not cryptocurrency.