As the 2024 U.S. elections reach their home stretch, crypto companies are opening their wallets to try and influence the results.
Nearly half of all the corporate money flowing into the election has come from the crypto industry, according to a report this week from the nonprofit watchdog group Public Citizen. The sum, approximately $119 million, was raised from a mix of contributors, with Coinbase and Ripple accounting for more than 80% of the donations.
Most of the money is going to super PACs that are backing pro-crypto candidates running for office this year. The industry has faced heightened scrutiny during the Biden administration, and Coinbase and Ripple are two of the biggest players that have been engaged in legal battles with the Securities and Exchange Commission.
Donald Trump, the Republican nominee, has tried to exploit the rift between the crypto industry and the Democrats by pitching himself as the pro-crypto choice and even keynoting a major bitcoin conference in Nashville, Tennessee, last month. But money is flowing into both parties, as the House, Senate and the presidency remain very much up for grabs.
No other sector is keeping up with crypto. That includes oil companies and banks, which have historically been big political contributors.
Since 2010, when the Supreme Court’s Citizens United ruling opened the door for limitless corporate money in U.S. elections, the crypto sector has accounted for 15% of all disclosed contributions, according to the report from Public Citizen. More than 90% of the corporate crypto cash that’s been raised was brought in this election cycle.
Rick Claypool, research director at Public Citizen, who authored the latest report, said the massive money poured in by crypto companies to “silence crypto’s critics and elevate its backers embodies everything that is wrong with the Supreme Court’s disastrous Citizens United decision.”
Claypool’s research shows that crypto corporations are second only to fossil fuel conglomerates in total election-related spending since the 2010 ruling.
Fairshake is the most popular of the pro-crypto, bipartisan super PACs. It’s funded by some of the industry’s leading companies and has become one of the top-spending PACs this year.
The majority of the group’s funds can be traced to four sources. Coinbase has contributed $49 million, venture firm Andreessen Horowitz has donated $47 million, Ripple has given $47 million and Jump Crypto put in $15 million. In total, Fairshake and its two affiliated PACs have raised around $169 million, with more than 90% coming directly from corporations.
Other funds have come from a mix of donors. Coinbase CEO Brian Armstrong, for example, gave $1 million, while the Winklevoss twins put in $5 million.
A filing with the Federal Election Commission on Tuesday showed that during July, Fairshake disbursed almost $75 million. Data compiled from FEC reports by OpenSecrets indicates that Fairshake has nearly $120 million in its coffers to deploy with less than 80 days to go until the November election.
The super PAC has pledged $25 million from that pool of cash to 18 House candidates in the general election, to be split among nine Democrats and nine Republicans. It’s committed another $18 million to three Senate races.
‘Eye-popping sums’
The industry’s strategy paid off in the primaries.
Public Citizen’s report found that of the 42 primary races that attracted money from crypto-backed super PACs, the candidate picked by the crypto industry won 36. But many of them aren’t publicly promoting their stance on crypto.
“When Fairshake and its affiliates spend money to influence races, either by attacking crypto skeptics or boosting crypto supporters, the ads don’t mention crypto at all,” said Claypool.
In New York and California congressional races, the crypto-funded campaign ads attacked the targeted candidates with traditional political jabs, and no mention of crypto.
“The sole reason crypto is a hot-button topic in this election cycle is that crypto businesses are spending eye-popping sums to make themselves impossible to ignore,” Claypool said.
Democrats are trying to show they can find common ground with the industry despite the tension that’s emerged in recent years.
Senate Majority Leader Chuck Schumer, D-N.Y., kicked off a virtual town hall dubbed “Crypto4Harris” in August. He said at the event that a crypto law could pass the Senate by the end of the year.
Vice President Kamala Harris’s campaign team is actively working to craft a platform stance around the crypto industry and reset the approach taken by President Joe Biden, several key Democrats told CNBC. On Tuesday, Harris’ campaign announced plans to adopt a pro-crypto innovation stance.
Coinbase Chief Policy Officer Faryar Shirzad praised the move, writing on X that he’s been “pleased to take part in a number of discussions with the Harris team.” He described the approach as “constructive” and said “the dialogue had been an important first step.”
Meanwhile, money has rolled into Trump’s campaign from digital asset executives since he leaned into being the pro-crypto candidate.
Trump has adopted increasingly bullish talking points on cryptocurrencies on the campaign trail, and he announced in late July that he had raised $25 million from crypto interests, a figure that CNBC hasn’t independently confirmed.
Crypto executives have turned up at fundraisers for Trump in San Francisco and Nashville, where the Republican nominee told an audience of conferencegoers that if he were returned to the White House, he would ensure that the federal government never sells off its bitcoin holdings.
“This afternoon I’m laying out my plan to ensure that the United States will be the crypto capital of the planet and the bitcoin superpower of the world,” Trump said. “And we’ll get it done.”