Regulation
Cryptocurrency giants exert their political muscle to reduce regulatory scrutiny
The cryptocurrency industry has emerged as a major force in US election campaign finance, amassing a staggering $160 million to support candidates favoring light regulation.
According to a Bloomberg report June 14With the Senate majority potentially hinged on the re-election of crypto skeptics like Sherrod Brown (D-OH) and Jon Tester (D-MT), the industry is poised to play a critical role in the 2024 elections.
Fairshake, the industry’s political action committee, has nearly doubled its funding in recent weeks thanks to donations of $25 million each from Corrugation laboratories, Andreessen Horowitz and Coinbase. Also the Winklevoss twins, co-founders of Gemini Exchange contributed $4.9 million.
Coinbase CEO Brian Armstrong, whose net worth has risen to $10.8 billion, is urging voters to oust lawmakers who don’t support digital assets. Earlier this week, so did Armstrong he went to Capitol Hill meet with senators from both parties.
Over the past 48 hours, I have met with more than a dozen Democratic and Republican senators in Washington to discuss creating clear rules for the cryptocurrency industry and consumer protections for cryptocurrency users. There is strong bipartisan momentum to get this done in the Senate now that FIT21 has passed the… pic.twitter.com/KWVylw1kDL
—Brian Armstrong (@brian_armstrong) June 12, 2024
The importance of lobbying for cryptocurrencies
Coinbase Chief Policy Officer Faryar Shirzad also highlighted the importance of political participation for the cryptocurrency industry. He said:
As an industry we have learned that you have to show up politically to be heard. […] We’re very, very committed to seeing it. We are very busy in this cycle and beyond. This is just the beginning of a long road.
The cryptocurrency giants’ main goal is to reduce Securities and Exchange Commission oversight, as the regulator has sued major players and imposed heavy fines for alleged violations of securities law. They prefer the CFTC as a regulator.
The industry flexed its political muscle in California’s Senate primary in March, spending $10 million on negative ads to help defeat progressive Rep. Katie Porter.
The high-profile influence campaign marks a notable departure from the scandals and failures that have rocked cryptocurrencies in 2022, including the implosion of FTX. Its former CEO Sam Bankman-Fried was sentenced to 25 years for crimes related to the management of FTX. The cryptocurrency market has since seen a recovery, supported by the US approval of spot Bitcoin ETFs.