Amid the sea of American flags and the ever-present blue signs at the Democratic National Convention in Chicago this week lurked Jonathan Padilla, the “crypto guy.”
Wearing a baseball cap and a flashy pineapple-print T-shirt, Padilla roamed the halls of the convention, discussing cryptocurrency policy with anyone who would listen. selfie In a Facebook post, he posed with his arm around Delaware Senator Chris Coons. “Senator Coons now knows about crypto,” the caption read.
Padilla is delighted by his new nickname “crypto,” which was assigned to him by other DNC delegates and which he sees as an implicit acknowledgement that cryptocurrencies have arrived on the political agenda. “Four years ago, cryptocurrencies were a non-issue and nobody was talking about them,” Padilla says. “But now, President Trump is talking about it at major conferences and it is being discussed by some of the most senior Democrats.”
Padilla is the founder of cryptocurrency marketing firm Snickerdoodle Labs and was previously a blockchain expert at PayPal. He is also one of the organizers of Crypto4Harris, a coalition of Democrat-supporting members of the crypto industry, which aims to encourage Kamala Harris to support specific cryptocurrency legislation and demonstrate that the sector is “not monolithically Republican,” Padilla says.
On August 14th, Crypto4Harris hosted a virtual town hall The meeting was attended by prominent Democrats, including Senate Majority Leader Chuck Schumer, who said he “believed in the future of crypto.” The group has also “made progress,” Padilla says, with “people from finance and policy” within Harris’ camp.
The group’s access to Harris’ team reflects a sea change in attitudes toward cryptocurrencies among American politicians, who seem to have accepted that there is a voting bloc that will cast its ballot based solely on which candidate will send their investments to the moon. (You know, forget immigration, healthcare, and the rest.) Not to mention the hefty donations that cryptocurrency companies are making.
Inspired by a rally in cryptocurrency prices in 2024, crypto firms have invested an “unprecedented” amount to influence the outcome of this year’s US election. An analysis According to consumer advocacy nonprofit Public Citizen, despite their comparatively tiny size from a revenue perspective (and continued dearth of use cases outside of financial speculation), cryptocurrency companies account for 48 percent of all corporate contributions this election cycle.
The cryptocurrency industry put some money behind the 2020 race. But there is a new urgency and forcefulness to their attempt to intervene in the 2024 campaign. “The industry believes this election is existential,” says Veronica McGregor, chief legal officer at crypto wallet company Exodus, speaking in a personal capacity as an industry veteran. “No matter who comes into office, changes must occur for our industry to thrive as it should.”
Most of the cryptocurrency industry’s political donations are funneled through a trio of affiliated super political action committees (PACs): Fairshake, Protect Progress, and Defend American Jobs. These organizations can’t donate directly to political candidates, but they can freely spend to promote those who make the right kind of complimentary remarks about cryptocurrencies.
Under the Biden administration, crypto companies have been hit hard and taken to court by US financial regulators, which they see as deeply unfair. But through super PACs, crypto companies hope to bring to power politicians who will support custom-made crypto legislation that puts an end to the debate over how cryptocurrencies should be classified and which regulators’ rules should apply.
The largest of these super PACs, Fairshake, has raised more than $200 million, a larger sum than any other super PAC, crypto-specific or otherwise. Its top donors include cryptocurrency companies Coinbase and Ripple, pro-crypto venture capital firm a16z, and an investment firm started by Cameron and Tyler Winklevoss, founders of cryptocurrency exchange platform Gemini.
Fairshake’s largest donor, Coinbase, which has contributed $45 million to the fund, is the subject of a formal complaint to the Federal Election Commission. Filed jointly by Public Citizen and software developer Molly White, creator of Follow the cryptographya project that tracks donations to the cryptocurrency industry, the complaint alleges that Coinbase violated campaign finance laws by contributing to Fairshake while it was negotiating a deal to become a federal contractor.
Coinbase declined an interview request, noting instead that public comments The company’s chief legal officer, Paul Grewal, has disputed the company’s characterization as a federal contractor, arguing that the service it provides is not technically funded by tax revenue. “It seems to us that Coinbase is trying to find a loophole that doesn’t actually exist,” White said.
