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Crypto is spending wildly in the 2024 race

Back in the day—i.e., 2022—crypto in politics was all about Sam Bankman-Fried, who lavished his millions on politicians under the guise of altruistic giving. It was a lie, of course, but everyone pretended to accept it for a while.

Bankman-Fried is warming a prison cell these days and the crypto industry has moved on. Alexander Sammon explains:

This time, there’s no grand political theorizing. No time to waste on utopian futures or societal aspirations. In fact, Coinbase’s billionaire CEO Brian Armstrong, the closest thing to a leader of this political formation, has openly declared that the United States is a society in “decline” and that “backup” options for existing nation states must be pursued. No, the 2024 crypto money machine has been reborn out of a cold, hard determination to do one thing and one thing only: put politicians in power who will stay out of crypto’s way.

And the crypto money machine is huge beyond imagining. Here's an estimate of corporate political contributions by sector for 2024:

Crypto is massively outspending everyone else combined, and this money is being wielded for one specific purpose: to gain passage of a bill that would only lightly regulate crypto. And it is being wielded ruthlessly:

Ohio Democratic Sen. Sherrod Brown, who has advocated for stricter regulation of the crypto industry in the past, is firmly in the lobby’s crosshairs. The group is spending an astronomical $40 million to oppose Brown, the chair of the Senate Banking committee.... That wild spending makes his victory look much more difficult. (“Money moves the needle,” Armstrong told Axios. “For better or worse, that’s how our system works.”)

Now, there's a lot more to the political world than direct corporate contributions. In fact, it's a fairly small share of the billions of dollars in total political spending this cycle. Nevertheless, this is a very impressive figure for an industry that contributed approximate zero in 2022. They want to be left alone to continue scamming the American public, and they're willing to spend eye-watering amounts to insure that.

So if you're wondering why practically everybody is either friendly or at least not hostile to crypto these days, this is it. They're facing too big a war chest to risk saying anything directly about regulating crypto. The $40 million flame thrower aimed at Sherrod Brown is all the warning they need.

30 thoughts on “Crypto is spending wildly in the 2024 race

  1. Jim B 55

    A good proportion of the US economy is controlled by scammers. Instead of specifically aiming at Crypto, the politicians who want it regulated should just aim at fraud. If fraud was properly prosecuted in the US Donald Trump would never have been president, he would have been in jail instead.

    1. jte21

      Then they'd just flood the zone with spending against stricter fraud prosecutions, saying that overzealous government regulation and enforcement is "strangling innovation" and "costing jobs."

      If there's ever an innovation that needed strangling, it's probably crypto.

      1. mudwall jackson

        +++

        jurors understand when you walk into a bank with a gun and rob it. not so much when the weapon used is a fountain pen.

        1. aldoushickman

          That, and stealing money at gunpoint is plainly criminal. Determining whether it's fraud to sell goods/services at price X when arguably they are worth price Y where price Y << price X is a much harder call to make, especially if the goods/services in question are difficult to price and/or the risk is relatively transparent and/or the buyer is charged with doing their own research.

          Do I think that crypto is a scam? Yes. Is "fraud prosecution" the answer? No--not any more than saying the answers to any number of times in history where banks or banklike entities caused harm (Great Recession, S&L crisis, the Great Depression, etc.) is just "fraud prosecution" rather than regulating the industry.

  2. D_Ohrk_E1

    That's how bubbles work, don't you think? An industry insists that it should not be regulated, and within the decade it implodes and takes the economy down with it.

    1. KenSchulz

      Just what I was thinking. Though I don’t think crypto is yet able to crash the economy. There have already been failures that had no wider impact (FTX, Mt. Gox).

      1. sonofthereturnofaptidude

        Maybe not the economy, but it could take down the electrical grid in some places if it gets big enough, I'd bet.

        1. aldoushickman

          I'm hoping that the crypto crash comes soon, and that the longterm result is just that a bunch of processing power and server farms were built, and that they can then be cheaply retasked to higher uses.

  3. tango

    This is bad news.

    Even when it's not specifically scamming people, Crypto heavily benefits speculators and criminals and uses a crap-load of electricity to do it. The world would be a better place without it.

    1. Justin

      PSA - vote anyway on 11/5. And vote in person! Delays associated with mail in ballots will just give the fascists an opportunity to cause trouble. Even if the worst happens, at least you'll be able to say you tried.

      1. LeeDennis

        Vote before 11/5 if you can. Get your name off your party's voter lists, free the campaign up to help someone else get to the polls.

  4. golack

    Single interest groups would try to generate support for their group and/or position. Indeed, to keep their tax exempt status, they could not endorse a candidate. Instead, you'd have these "call your congress person" about x, or y, or z.

    Now, pacs and super-pacs can run amok.

  5. jte21

    IIRC earlier this year Mark Cuban talked about this in an interview. When asked why so many Silicon Valley titans like Peter Thiel were so all in for Trump, he said "it's basically a big crypto play" -- they want a free hand to go wilding with crypto scams and know Trump is an idiot and can be bought and so he's their man.

    1. aldoushickman

      That makes sense. Recall Trump vowing to maintain US holdings in bitcoin? That doesn't sound like the sort of idea he'd come up with himself.

    1. aldoushickman

      That, and it's a pretty big indictment of how stupid crypto is. You'd think that if your industry was flush with cash, the highest and best use of that cash would be investing in your industry (more servers, more programmers, more whatever).

      Yet, despite being colossally smaller than, say, the real estate or energy industries, crypto is spending ~2 orders of magnitude more money on political contributions. That's a sign that there isn't anything real to the crypto industry.

  6. Scott_F

    "the United States is a society in 'decline' and that 'backup' options for existing nation states must be pursued."

    Worry anytime someone's plans require that society collapses.

    This sounds just like a guy who cannot think in terms other than computer code. They want to be our Philosopher Kings but they are just so dim outside their area of expertise.

  7. QuakerInBasement

    "They're facing too big a war chest to risk saying anything directly about regulating crypto."

    Cowards. It would be incredibly easy to paint crypto as the financial lifeline of drug dealers and human traffickers.

  8. D_Ohrk_E1

    Think about this for a moment.

    - The goal of free trade capitalism is to perfectly match supply with demand. Antitrust laws, amirite? When demand outstrips supply, it encourages new entrants to provide more supply and existing players to produce more supply. If a monopoly blocks the increase of supply to meet demand, we break apart that monopoly. Perfect competition keeps prices and economies steady.

    - The goal of crypto is to avoid perfect supply and demand. For one, the stated goal of crypto is to literally limit the supply. Additionally, the only way to "make money" in crypto is to take advantage of disequilibrium between supply and demand, following the direction of flows. You ever heard a crypto fan tell you that their ideal crypto system is where crypto values are stable?

    If the central goal is to maintain instability within the system, naturally, you'd avoid regulation that might bring stability to that system. And the folks with the most crypto would naturally be the biggest opponents to regulation as they're the ones most invested in system instability. Even stability of trade is discouraged; within the margins of trade comes profitability. One minute can mean hundreds of dollars.

    What benefit does crypto have for humanity? Ostensibly, isn't greed the goal of crypto?

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