The Crypto Industry Could Hand Control of the Senate to the GOP

Its main PAC is raising a fortune and using it to influence dozens of races.

By David Moore and Donald Shaw

The cryptocurrency industry has greatly increased its super PAC war chest as it prepares to spend millions in the battleground states of Montana and Ohio, where the re-election bids of Democrats Jon Tester and Sherrod Brown will likely determine which party controls the Senate.

In May, the crypto industry’s lead super PAC, Fairshake, raised a whopping $85 million, topped by three donations of $25 million apiece from crypto executives and firms, according to its latest FEC filing. Fairshake and its two super PAC affiliates, the Democrat-focused Protect Progress and the Republican-focused Defend American Jobs, form a trio of spending groups that have been touting their plans to back crypto industry-friendly candidates in elections—and knock out industry critics. Together, Fairshake and its two affiliates have raised more than $187.4 million this cycle, according to a review of FEC records, making the crypto groups among the highest-raising super PAC networks in the 2024 elections. At the fore, Fairshake PAC stands with nearly $107 million in cash on hand as of the end of May. 

Fairshake has backed the winning candidate in 33 of the 35 congressional primaries that it has entered, including multiple wins in elections yesterday, according to a CNBC tally, and the PAC has been threatening to hop into the key contests in Montana and Ohio since March, when its spokesman Josh Vlasto mentioned them as the group’s two Senate targets in the general election. Both states were won by Trump in 2020 and election forecasting project Cook Political Report ranks the Senate races in both states as “toss ups.” 

As chair of the Senate Banking Committee, Brown has been a vocal critic of the crypto industry, according to the Stand With Crypto website, a political advocacy website created by the crypto industry. Tester, also a member of the Banking Committee that would play a large role in writing rules for cryptocurrencies, has been neutral on crypto, according to Stand With Crypto, though in 2022 he expressed an inclination to regulate the industry in a “Meet the Press” appearance.

Fairshake’s $85 million haul in May marked a huge ramp-up in its fundraising this year, after the network of three super PACs raised around $78 million as of the end of 2023 and another $7 million during the intervening months. The trio of groups have already unloaded $39.2 million in federal elections this year, according to OpenSecrets. Fairshake spent more than $10 million against Rep. Katie Porter’s bid for the Democratic Senate nomination in California, and more than $2 million against progressive Rep. Jamaal Bowman, who yesterday lost his House primary in New York.

Tester is facing Republican Tim Sheehy, and Brown is facing Bernie Moreno, a businessman who founded a property titles company that uses crypto-adjacent blockchain technology. The Stand With Crypto website rates Sheehy and Moreno as both strongly supportive of crypto. 

Most of the money Fairshake raised in May came from three sources that each gave $25 million: cryptocurrency exchange Coinbase; crypto payment protocol company Ripple Labs; and technology investment firm Andreessen Horowitz, a major investor in Coinbase. Another $10 million was contributed by Jump Crypto, a crypto trading firm whose president resigned this week after it was reported that the Commodity Futures Trading Commission (CFTC) was investigating the company. Coinbase, Ripple Labs, Andreessen, and Horowitz have each contributed smaller amounts to Protect Progress and Defend American Jobs.

The mostly unregulated multi-trillion-dollar cryptocurrency industry has seen spectacular crashes in recent years, such as the collapse of major exchange FTX in 2022 that harmed up to a million investors and saw billions of dollars worth of assets lost. The watchdog Consumer Financial Protection Bureau has warned that crypto markets are rampant with scams such as “pig butchering” where scammers play on people’s emotions to gain control of their assets.

Coinbase has been a top donor to Fairshake, giving it slightly more than $45 million since last November. The company’s CEO Brian Armstrong has also chipped in $1 million. Andreessen Horowitz has given Fairshake $44 million, with half attributed to partner Marc Andreessen and half to partner Ben Horowitz. Ripple Labs has given the PAC $45 million. Other donors to Fairshake include Cameron and Tyler Winklevoss ($5 million combined), investor Phil Potter (33 BTC, today worth more than $2 million), and Union Square Ventures’ Fred Wilson (6,500 shares of Coinbase stock, today worth about $1.4 million).   

The cryptocurrency industry has increased its spending on lobbying during the Biden administration. The industry’s lobbying spending peaked in 2023 at $24.8 million, according to OpenSecrets. Coinbase led the industry in lobbying in 2023 by spending $2.8 million, followed by the Blockchain Association at nearly $2 million in spending and Bitfinex holding company iFinex Inc. at $1.2 million. 

In May, Trump said at a fundraiser that he supported crypto and that “if you are in favor of crypto, you better vote for Trump.” Earlier this month at a San Francisco fundraiser, Trump touted himself as a “crypto president” and slammed the Biden administration’s regulatory efforts in the industry. The high-dollar event was hosted by tech venture capitalists David Sacks and Chamath Palihapitiya, two superwealthy tech investors among the dozens of billionaires who are backing Trump’s re-election bid. 

Trump’s championing of crypto stands in stark contrast to his previous statements on the issue, after he called himself “not a fan of Bitcoin and other cryptocurrencies” in social media posts in 2019. Also this month, Trump continued attacking the Biden White House’s regulatory approach toward cryptocurrencies after he held fundraising meetings with Bitcoin miners at Mar-a-Lago, with one attendee saying the miners had pledged $100 million for Trump. Dave Ripley, CEO of the cryptocurrency exchange Kraken, said Wednesday that he is "extremely encouraged by what we've seen from Donald Trump and his campaign," noting that Trump has "met with many people in the industry and had several events where he's building that knowledge and come out very positively toward cryptocurrency, which we absolutely embrace and think he's an intelligent person."

The crypto industry has been pushing Congress to pass legislation establishing a U.S. regulatory regime for cryptocurrencies, and in particular, to have the CFTC oversee the industry, an agency that is viewed as friendlier than the Securities and Exchange Commission (SEC). In May, the Republican-controlled House of Representatives passed such a bill, the Financial Innovation and Technology for the 21st Century Act (a.k.a. FIT21), by a bipartisan vote of 279-136. Blockchain Association CEO Kristin Smith hailed the vote as “a watershed moment and badge of Congressional validation for the crypto industry in the United States.” The Biden administration, while stating its opposition to the measure, has not threatened to veto the legislation if it is passed by the Senate. House Majority Whip Tom Emmer (R-Minn.) recently told the audience of the Consensus 2024 conference that his “best bet” was that if the bill advances during this session of Congress it would happen after the November elections, during a “lame duck” session.

Watch our deep dive into the origins and goals of the crypto industry: