Cryptocurrency industry pumps money into US election campaign

1. Cryptocurrency industry pumps money into US election campaign

This article was originally published in

German

and was automatically translated.

By the end of May, the cryptocurrency industry had raised at least $187 million for the current US election campaign. This figure was compiled by Molly White, Crypto Critic from publicly available data. White programmed the website followthecrypto.org (open source). It shows how much money has flowed to the largest super PACs that support pro-cryptocurrency candidates or want to block consumer protection candidates.

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The largest crypto super PAC is called Fairshake, and it’s about the same size as Make America Great Again (MAGA), the main super PAC supporting Donald Trump, who is in his fourth White House campaign: MAGA has raised $178.6 million through the end of May, Fairshake $177.9 million. However, MAGA has already spent more money, so Fairshake is clearly ahead in terms of money raised ($107 million, plus perhaps $25 million that’s expected to be deposited at Coinbase, versus MAGA’s $94 million).

Unlimited donations possible to the super PAC

PAC stands for Political Action Committee. These are traditionally campaign funds for political candidates. They are allowed maximum contributions per donor. However, there are no limits for super PACs. Americans can donate unlimited amounts to them. However, super PACs are not officially allowed to coordinate their campaigns with the candidates they support.

So far, Fairshake has spent most of its money on fighting Democratic candidates. Fairshake spent more than ten million dollars on negative advertising against Democrat Katie Porter alone – and it was successful: the Californian lost the primary and therefore cannot be elected to the US Senate in November. Fairshake spent another two million dollars on advertising against Democrat Jamaal Bowman, who also lost the primary. The New Yorker will therefore certainly not enter the lower house.

Fairshake gave even more money, $15.5 million, to two other super PACs. $5 million to Protect Progress, which aims to support crypto-friendly Democrats, and twice as much to Defend American Jobs, which aims to help crypto-friendly Republicans win elections. It’s worth noting that the reported donation amounts don’t add up to spending plus cash reserves. This is partly because super PACs must report their spending within 48 hours, but their revenue is only totaled monthly, and with a lag. As a result, there’s no data on June donations yet, but there is data on election spending in July.

Change of opinion with Trump

Crypto industry lobbyists want politicians to believe that cryptocurrency is an important issue for voters. The organization Stand with Crypto lists an even slightly higher donation amount on its website (because some smaller crypto super PACs are likely included). According to the organization, 1.3 million donors have given $179.4 million.

That may be true, but it gives the misleading impression of a large grassroots movement. Indeed, the vast majority of the money comes from a small number of crypto moguls: Fairshake received $46.5 million from cryptocurrency exchange Coinbase, $45 million from Ripple Labs, $44 million from venture capitalist Andreessen Horowitz, $15 million from Jump Crypto, $5 million from Winkelvoss Capital Management, and $1 million each from Kraken, Circle, and Union Square Ventures. (These amounts also include donations from the owners or executives of those companies.) For the other two crypto super PACs mentioned, the bulk of the donations are spread across even fewer companies. Small donors—unlike Joe Biden’s reelection campaign—are not a factor.

The publicity has already had an effect on Donald Trump. While he was once a harsh critic and described cryptocurrencies as a scam, even wanting them to be shut down, he began issuing NFTs himself in 2022. “If you’re for cryptocurrencies, you’d better vote for Trump,” the former president now says.

Outgoing President Joe Biden, on the other hand, has barely commented on cryptocurrencies. However, a Presidential Decree of March 2022 is dedicated to the topic of digital assets and blockchains. Biden calls for measures for consumer protection, financial stability and the fight against crime, among others, but also to “support technological progress to promote the responsible development and use of digital assets.” Nevertheless, the crypto industry has designated Donald Trump as its hero and Biden as its opponent.

Irrelevant topic

In reality, the American electorate has little interest in issues related to cryptocurrencies. This is even revealed by a survey commissioned by the lobbying organization Digital Currency Group. in six US states States where the election result is contested (“swing states”). Of the 1,201 people registered to vote, 80% explicitly disagreed with the statement that cryptocurrencies are an important issue in the election decision. And the remaining 20% ​​are by no means all supporters of cryptocurrencies, as 69% of all respondents said they had a negative attitude towards cryptocurrencies.

It is therefore surprising, at first glance, that the election ads funded by Fairshake mostly leave the topic of cryptocurrencies aside. Broader topics such as technology or finance are also barely mentioned. Instead, completely different arguments are used to explain why voters should (or should not) vote for certain candidates. Drawing voters’ attention to candidates’ views on cryptocurrencies is clearly not in the industry’s interest.

Incidentally, Molly White’s transparency project, Follow the Crypto, is alsofunded by donations. Like the famous Molly White movie Newsletter Citation neededThe project is ad-free. The American invites politically motivated people to use Follow the Crypto’s source code to make donations from other sectors or interest groups more transparent. However, collecting the data yourself takes time.

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