The crypto industry is pouring millions of dollars into the 2024 elections in an effort to bolster crypto-friendly candidates.
Could a public policy matter that, today, is estimated to affect just seven percent of Americans become a flashpoint in the remaining weeks of the 2024 election? Given the amount of money being spent by the industry to sway lawmakers and voters regarding this issue, it certainly is possible.
We are, of course, talking about cryptocurrency.
While the industry touts a much larger number, according to the Federal Reserve, in 2023 just seven percent of Americans held digital assets. Still, that relatively low number will not keep lawmakers from debating this issue on Capitol Hill in the coming weeks, and it certainly has not stopped the digital asset industry from using their bitcoin to influence the election.
But will these dollars move the needle on the outcome of Election 2024? How animated are voters by this issue? Let’s take a look.
Crypto Firms Are All In On Election 2024
According to AXIOS, the digital asset industry accounts for almost half the money contributed by corporations to political action committees (PACs) so far in 2024 – an astounding figure. Indeed, blockchain companies have supplied 48 percent of the $248 million of corporate money donated in the 2024 election cycle. Contributions have come primarily from Coinbase, the largest U.S. crypto exchange, and Ripple, which owns a stablecoin called XRP.
The companies have given to both Democrats and Republicans, and even have engaged in primary contests. “No industry has ever before so wholeheartedly embraced raising as much directly from corporations and openly using that political war chest … to discipline lawmakers toward adopting an industry’s preferred policies,” said Public Citizen’s Rick Claypool. “The crypto sector strategy seems to be: give crypto corporations what they want, or your political career gets it.”
One state where the digital asset industry is hoping to have a particularly significant influence is Ohio.
As The New Republic reported this morning, the Fairshake PAC, a superPAC funded by “techno-optimist” Marc Andreessen and Coinbase, “is hoping to hand the Senate to Republicans in an unprecedented infusion of corporate cash into the 2024 election.” Specifically, Defend American Jobs, an arm of the Fairshake PAC network, recently announced it would spend at least $12 million to defeat Senate Banking Committee Chair – and crypto skeptic – Sherrod Brown (D-Ohio).
Andreessen also has endorsed former President Donald Trump, arguing he is “the right choice” for “the future of our business.” Cameron and Tyler Winklevoss, co-founders of the digital asset firm Gemini, pledged to donate $1 million each to Trump. (More on the former president’s stance on crypto below.)
The digital asset industry also is taking its arguments to voters.
Stand With Crypto, an advocacy organization created in 2023 by Coinbase, launched a bus tour in Phoenix last week and, according to CNBC, plans to spread “its message to five battleground states ahead of the election.” The goal of the bus tour is to help boost voter registration. “Between online and in-person efforts, Stand with Crypto has signed up 104,000 people through its voter registration tool,” CNBC said.
While 100,000 voters may not sound like many in a country of 350 million, in swing states, these votes could be crucial.
The bus tour will end next week, Wednesday, Sept. 18, in Washington, D.C., where several top Coinbase executives, including Chief Legal Officer Paul Grewal, will address the audience. The digital asset community’s arrival in Washington may be well-timed.
Just Weeks Before Election, House Republicans Will Champion Crypto
Despite Congress’ long fall to-do list, including the need to pass legislation to stave off a federal government shutdown, House lawmakers have said that they plan to devote time to debating digital asset regulation this month.
As Coindesk has reported, “The U.S. House Financial Services Committee (HFSC) is poised to launch a series of crypto hearings digging into several aspects of the industry, according to a person briefed on the planning.”
Those hearings began yesterday when an HFSC subcommittee panel examined the future of “decentralized finance,” or DeFi, and two pieces of legislation related to it. One of these bills would allow the Securities and Exchange Commission, Commodity Futures Trading Commission, and the Secretary of the U.S. Department of the Treasury to jointly carry out a study on decentralized finance. A second piece of legislation would require the Treasury secretary to report on privacy-preserving technologies.
Democrats who participated in the hearing clearly were skeptical of digital assets and emphasized issues related to income inequality, which are a concern for voters. Regarding DeFi, Rep. Brad Sherman (D-Calif.) said, “What we have here is an effort to liberate billionaires from income taxation.” Rep. Sherman also quipped that, “every time a billionaire successfully cheats on his taxes, a member of the Freedom Caucus earns his wings.”
The hearing also touched on World Liberty Financial, a DeFi project that Blockworks noted has been endorsed by the Trump family. HFSC Ranking Member Maxine Waters (D-Calif.) is no fan of World Liberty Financial and used the hearing to take on the former president and to argue that his favored platform is a good example of why the blockchain industry is dangerous.
“Bad actors took advantage of the opportunity to scam potential users. Laura Trump and Tiffany Trump’s X accounts were hacked, and scammers used them to announce links to a coin falsely claiming to represent World Liberty Financial,” Ranking Member Waters said. “According to the analysis, at least 200,000 people viewed the posts, and approximately 2000 people purchased $1.8 million worth of the fake token.”
On the Senate side, meanwhile, it is still unclear whether Agriculture Committee Chair Debbie Stabenow (D-Mich.) plans to reschedule a committee vote on her proposal to overhaul digital asset regulation. The panel was supposed to vote on the measure in July, but the chairwoman pulled the bill from consideration due to opposition from Ranking Member John Boozman (R-Ark.) and several Democratic members of the panel.
Given where the crypto industry has focused its Senate election energies, it is unlikely the chamber’s Democratic leadership will have an appetite to move legislation favored by the industry.
Meanwhile, Where Do The Presidential Candidates Stand?
Prior to last night’s debate between Vice President Kamala Harris and former President Donald Trump, the Stand With Crypto Alliance had asked ABC News to ask a digital asset-related question. (The group sent ABC a letter signed by 2,000 individuals that said, “I am one of the 52 million Americans who own cryptocurrency.” Notably, that 52 million number is not backed by the Fed’s research.)
The group also planned to host 2,500 debate watch parties across the country.
The moderators chose to ignore that request, however, and neither Harris nor Trump brought up the topic.
That does not mean the debate did not, and will not, have an effect on the industry. As Bloomberg noted this morning, bitcoin “fell for the first time in five days after the debate as betting odds favored Harris — who has yet to detail a policy position on crypto — over Trump, who has pivoted to courting the digital-asset sector after previously dubbing it a ‘scam.’”
Indeed, Trump has become more and more vocal about his support of crypto, while not actually releasing any specific plans for how his administration would handle it. According to Newsweek, on September 5, Trump spoke at the Economic Club of New York and said, “Instead of attacking industries of the future, we will embrace them, including making America the world capital for crypto and bitcoin.”
Newsweek said “Harris has not spoken publicly about crypto regulation,” but noted the Biden administration “cracked down on cryptocurrency in 2022” in an executive order that specified “a national policy for digital assets across six key priorities: consumer and investor protection; financial stability; illicit finance; U.S. leadership in the global financial system and economic competitiveness; financial inclusion; and responsible innovation.”
Where Do Voters Stand?
Digital asset regulation does not rank among Americans’ top concerns this election season. In fact, even crypto owners themselves seem a little tepid in their enthusiasm. According to a survey by Gemini, 73 percent of U.S. voters who currently own crypto said a candidate’s stance on crypto would have only “some impact” on their vote. Only a little more than one-third, 37 percent, said a presidential candidate’s position on crypto would have a “significant impact” on their vote.
Additionally, recent polling from Fairleigh Dickinson suggests crypto holders are a diverse group meaning that, if crypto is not their number one issue, they likely will not vote as a bloc. Specifically, Fairleigh Dickinson’s survey found that while crypto owners are disproportionately young men, “liberals, moderates, conservatives, progressives and, MAGA voters are all about equally likely to say that they own cryptocurrencies.”
That lack of interest does not mean Americans do not have strong feelings about how policymakers should handle the question of digital assets, however.
This past spring, The Harris Poll released a survey that found:
- 40 percent of voters want political candidates to talk more about digital assets;
- Most voters do not trust elected officials to understand crypto and more than half are concerned about policymakers stifling innovation via overregulation;
- One-quarter of voters said demonstrated enthusiasm toward crypto would make them trust a political candidate more while 30 percent of voters said crypto-friendliness would make them more likely to support a political candidate;
- A majority of voters favor of an overhaul of crypto regulation; and
- About 25 percent of voters want elected officials to focus on crypto regulation or protections for crypto investors.
A sleeper issue this election season? Perhaps. But not for lack of spending by the crypto industry.