Donations from crypto companies key to US political campaigns

A report published recently reveals that nearly half of all corporate donations to political campaigns ahead of the November election come from the world of cryptocurrencies.

The report, conducted by Public Citizen, notes that cryptocurrency firms Coinbase and Ripple contributed 80% of the roughly $119 billion donated by companies in the sector, and, as of now, most of the money is flowing to super PACs supporting the most cryptocurrency-friendly candidates.

Notably, the contribution of cryptocurrency companies exceeds even that of banks and oil companies.

According to the Public Citizen report, since 2010, when the Citizens United ruling by the Supreme Court allowed unlimited corporate contributions to campaigns, the crypto sector has accounted for 15% of all disclosed donations. It added that more than 90% of the money raised from this industry has been raised in this election cycle.

Since the 2010 ruling, the report adds, the cryptocurrency industry is second only to fossil fuel conglomerates in terms of political campaign donations.

The super PAC that has poured the most money into campaigns is the bipartisan fund Fairshake, the most popular of all, which receives significant contributions from major firms such as Coinbase, the largest exchange for cryptocurrencies in the U.S., as well as Ripple and individual donors affiliated with the venture capital firm Andreessen Horowitz, among others.

According to a filing with the Federal Election Commission last week, Fairshake contributed nearly $75 million in July and has announced it will donate another $25 million to 18 House candidates. The money will be split between nine Democrats and nine Republicans.

The super PAC has also committed another $18 million to the campaigns of three Senate candidates.

Other funds have come from Coinbase CEO Brian Armstrong, who paid $1 million, and the Winklevoss twins, who donated $5 million and recently poured $2 million in bitcoin into Donald Trump's campaign.

The Republican Party's fury with Fairshake

Fairshake PAC and its super PACs recently were the targets of Republican Party criticism because they have pumped millions of dollars into two Democratic Senate candidates: Ruben Gallego, who will face Kari Lake in Arizona, and Elissa Slotkin, who will run against Mike Rogers in Michigan, and all indications are that each will be able to count on $3 million in advertising, as the organization has pledged that amount to their campaigns.

Speaking to NBC News, Fairshake contended that the ratings provided by Stand With Crypto were a key factor in the decision to support the two Democratic Senate candidates, who this year supported a historic legislative bill on cryptocurrencies.

Despite the Democrats' change in stance on cryptocurrencies, it's worth noting that Kari Lake has earned an excellent rating from Stand With Crypto, another reason Republicans have been upset with Fairshake.

Josh Vlasto, a spokesman for Fairshake, said in a statement that the organization and affiliated super PACs seek to "support candidates who embrace innovation, want to protect American jobs and are committed to working across the aisle to get things done and oppose those who do not."

NBC News noted that a Republican strategist involved in Senate races warned that Fairshake's decision could hurt Trump.

"Coinbase and Fairshake are attempting to become toxic to Republicans. Spending against two key GOP candidates could jeopardize the Senate and harm Trump." It added: "Gallego and Slotkin have voted against bitcoin interests and would vote to confirm a far-Left SEC Chairman. It makes no sense."

NBC News also quoted a senior industry insider speaking on condition of anonymity who was highly critical of the Democrats' support. "Republicans are WTF about what’s going on with Fairshake, and I think that’s a pretty bad omen for the industry, that people are wondering why our main trade association is pointing its arsenal at our friends."

According to Bloomberg, Vice President Kamala Harris has been trying to reach out to the cryptocurrency industry since she was nominated as the Democratic candidate for president, so she talked via Zoom with executives from major companies in the field, who expressed their concerns.

The Democrats have also launched a group called Crypto4Harris in order to deepen the link with the cryptocurrency industry. Likewise, Wes Moore, governor of Maryland, argued during a recent interview on CNBC that a Harris-led administration would provide a more favorable framework for crypto businesses.

However, a former Trump official doesn't believe a Harris administration will be any friendlier to businesses in the cryptocurrency world. "The big political question here is, can Harris convince proponents of industry that she has done a 180, or is it just talk?" they said.