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Cryptocurrency Lobbyists Are Polluting the US Election
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It’s not particularly fashionable to point out when Donald Trump does something right (accidentally or otherwise). But for the record, in 2021 he was right about cryptocurrencies. Having pointed it out two years earlier cryptocurrency “is not money”” and that its value is “based on nothing,” said the former bitcoin president “It really looks like a scam“, he suggested that the cryptocurrency was “a disaster waiting to happen”, and said that “the bitcoins of the world” should be regulated “very, very high” [sic].
This was less than a year before the cryptocurrency world imploded in spectacular fashion. From May 2022 onwards, a series of cryptocurrency exchanges, tokens, and other projects collapsed in rapid succession, wiping out tens of billions of dollars in supposed “value” overnight. Cryptocurrency prices and the market for “NFTs,” a type of digital token that is just as useless as any other but pretends to be otherwise – tanked. Regulators have not only failed to regulate cryptocurrencies to a “very, very high” degree; they slept at the wheel. In December of that year, cryptocurrency’s most notorious criminal, the man known as SBF, was arrested on fraud and conspiracy charges for which he would later be sentenced to 25 years in prison.
But Trump, alas, is no longer right about cryptocurrencies. As the market recovered, he suddenly went from “not a fan” to looking downright enamored.
He promised last month to stop Joe Biden’s crypto-crusade and said he would support the right to self-custody—technical jargon that sounds very different from something Trump would have invented himself. “To the holders of 50 million cryptocurrencies in the nation, I say this,” he told a crowd at a Libertarian convention. “I will hold [Democratic senator] Elizabeth Warren and her minions away from your bitcoins.”
Trump suspiciously appeared to have had some deep and significant relationships with the cryptocurrency industry. In fact, a couple of weeks ago he hosted a group of bitcoin miners and industry executives at his private club/permanent residence Mar-a-Lago. One of those present, the CEO of BTC Inc, he told CNBC that “as an industry we are committed to raising over $100 million and producing over 5,000,000 voters for Trump’s reelection effort.” You can see why Trump might have found their arguments so persuasive.
There is also no attempt to hide the buying of influence; in fact, it’s just the opposite. Incumbent New York Congressman Jamaal Bowman on Tuesday was defeated in the most expensive primary election in Democratic Party history. A vocal critic of Israel, who lost to a pro-Israel rival, he also voted against cryptocurrency laws. Later, Tyler Winklevoss, who runs the Gemini cryptocurrency exchange with his twin brother Cameron, exulted on X: “Politicians everywhere need to understand that this is what happens when you fight with the cryptocurrency army.”
Last week, the Winklevoss twins donated $1 million each to the Trump campaign (a portion of which was later refunded for exceeding the maximum individual contribution rules), calling him the “pro-crypto” choice. They also donated $4.9 million to a pro-crypto Super Pac, an independent fundraising committee that can receive unlimited funds from individuals, corporations, and other groups, called “Fairshake.” This has already collected more than 177 million dollarssecond only to the “Make America Great Again” super Pac, with just over $178 million.
Fairshake was a major contributor to Tuesday’s New York primary, spending more than $2 million on ads targeting Bowman. Along with the Winklevii, a number of other cryptocurrency billionaires and their companies have contributed large sums to Fairshake, including cryptocurrency firm Ripple, which donated as much as 45 million dollars; cryptocurrency exchange Coinbase, with just over $45 million; AND “techno-optimist“Marc Andreessen and business partner Ben Horowitz, who between them and their business donated almost 70 million dollars.
According to data compiled by AdImpact, Fairshake and its pro-cryptocurrency Super Pac affiliates, “Defend American Jobs” and “Protect Progress,” have already spent more than $37 million on ads in the primaries. Many of the crypto-friendly candidates they support have won their respective House and Senate races.
We should be very concerned about the influence and reach of this rapidly growing cryptocurrency lobby. Besides, the lobbyists do not represent the interests of American cryptocurrency holders. Regulators are not going after retail investors, but rather the cryptocurrency companies whose founders have made billions by skimming profits from those retail investors.
Their political allegiances appear equally uneven. And the idea that a group of bitcoin executives could provide Trump with 5 million voters is a farce that even he needs to be able to see through.