Ahead of the midterm elections in the United States, the cryptocurrency industry continued to spend politically to protect itself from regulatory crackdowns with a more receptive Congress.
Many digital asset companies and executives Support political action committees, including GMI PAC, whose major contributors include FTX Trading Ltd. Chief.
According to campaign contributions, FTX Trading Ltd. became the third largest source after Democratic megadonor George Soros and cardboard box maker Uline. Donations also come individually from FTX CEO Sam Bankman Fried (SBF).
According to SBF, it supports candidates to prevent pandemics and support finance without permission.
1) I was a major donor in the D and R primaries.
Support constructive candidates across the aisle to prevent pandemics and bring a bipartisan climate to DC.
And work with them to support finance without permission.
— SBF (@SBF_FTX) November 5, 2022
Possible reasons for political donations
Increasingly, authorities are scrutinizing crypto issuers and lending platforms, alleging they fail to comply with money laundering laws designed to protect investors. In recent years, the Securities and Exchange Commission (SEC) has filed nearly 100 lawsuits against crypto entities.
However, pollsters predict that the Senate and House will be taken over by Republicans, although the White House will remain Democratic for at least another two years, according to a report from the Wall Street Journal.
Crypto enthusiasts can welcome Republican majorities since Republicans are often their most ardent supporters, urging lawmakers to move more bills than the industry has demanded. Additionally, a Republican-controlled Congress will likely pressure agencies, like the SEC, to relax the aggressive approach they have taken against crypto companies.
Reduced political funding
In the immediate run-up to the Nov. 8 midterm elections, Crypto executives have cut political donations, a move following the crash of digital currencies like Bitcoin and Ether.
It is typical for donors to contribute more money to campaigns and political committees during the third quarter. However, cryptocurrency companies have only donated $5 million or less every month since July, with September’s $3.9 million representing a 63% drop from June’s $10.4 million. , according to a report from Bloomberg.
Source:Bloomberg: Federal Election Commission filings with data available through October 19
However, the research group OpenSecretswhich tracks political donations, reports that Crypto businesses and their employees invested $73 million in the 2022 election, up from $13 million in the 2020 cycle.
Additionally, the industry spent $15 million on lobbying in the first nine months of this year, more than in the previous eight years. In this regard, the sector outspent some drugmakers and defense contractors for much of the two-year election cycle.
As the lobbying effort continued, members of Congress from both parties introduced legislation that the crypto industry is advocating for.