What do you do when you’re a special interest, your product has no legitimate use, and your industry has an long RAP sheet of criminal convictions, predatory conduct, illegal behavior, bankruptcies, lawsuits, & scandals?
If you’re the crypto industry, you don’t talk about crypto and you spend your predatory profits on campaigns to buy political influence and allies to keep the scams going.
That is what FTX and its former CEO Sam Bankman-Fried did in 2021-2022 before FTX went bankrupt and SBF was arrested, convicted, and sent to prison. What the crypto industry is doing in 2023-2024 is just an extension of that earlier influence buying campaign. The industry has again infiltrated Capitol Hill with tens of millions of dollars in lobbying expenditures. What has this mountain of money in lobbying and influence peddling bought the crypto industry? So far, it’s been able to hijack the public agenda by getting its political allies to move its special interests above the public interest. Unsurprisingly, increasing crooked crypto scams are not in the top 20 policy concerns of Americans this year.
Crypto’s top goal is to get their special interest legislation passed to give it an aura of legitimacy while subjecting it too little if any regulation. This will result in an explosion of crypto offerings and platforms that will harm investors, markets, and financial stability. Unfortunately, they appear to be succeeding, as we’re seeing lots of legislation introduced in Congress, a blistering hearing pace in Congress, and two dedicated subcommittees for so-called digital assets in both House Financial Services and House Agriculture Committees. Indicating just how bad things are, the crypto-friendly legislation that was endorsed by FTX and SBF that would endanger investors, consumers, and financial stability is still being pushed by crypto’s Congressional and regulatory allies.
Now, the crypto industry is looking to make its work in Congress even easier by trying to defeat elected officials who put the public interest first and are not crypto-lackeys. A crypto industry dark money group (known as a Super PAC) with the Orwellian name “Fairshake” raised nearly $80 million in just the last 3 months of 2023 reportedly from crypto industry titans like Coinbase. If there was a truth in advertising requirement it’d likely he to be called “Shake Down”! Regardless, it recently attempted to influence the California Senate primary by running vicious ads against Rep. Katie Porter, a staunch investor protection advocate. Crypto was de facto supporting her opponent Rep. Schiff, who released a pro-crypto statement just before crypto’s dark money group fired its money canon.
No surprise, most crypto’s ads don’t mention crypto – they just attacked Porter and others on unrelated issues. They know the American people and voters are skeptical if not hostile to crypto so they can’t talk about crypto, which is also why they buy and spread misleading and biased polls that overstate the number of Americans who own crypto. It’s as if Ford ran an ad campaign and never mentioned its cars – pretty much tells you everything you need to know about these scammers.
These crypto PACs are poised to spend lots more money targeting other elected officials who don’t sell out the public interest and serve their special interests. By election day 2024, they will likely spend hundreds of millions of dollars.
Fairshake Ad in California Senate Race:
The industry is looking to make the greatest impact by focusing on top-tier Senate races across the country, including Ohio and Montana. In Ohio, one of Senator Sherrod Brown’s general election contenders, Bernie Moreno, has received the endorsement of former President Trump and has been a crypto booster in the Cleveland Area. The Cedar Innovation Fund, another dark money group also reportedly funded by Coinbase, is looking to boost Moreno by relentlessly attacking Brown, who has spent his life fighting for workers, Main Street Americans, and protecting investors from predators like the crypto crowd.
Along with Senator Brown, Senator Elizabeth Warren is one of the most independent and fearless elected officials in Washington. They regularly defy special interests and defend the public interest. That’s why Brown, and Warren, who is also likely to face a crypto industry opponent or two in her race, are prime targets of special interests generally and crypto in particular.
It's clearer than ever that the crypto industry will do whatever it can to influence politicians and corrupt the process to advance its special interests. It's up to courageous elected officials and concerned citizens to stand up to the industry and expose its false and misleading ads and propaganda. It won’t be easy, but sunlight and truth are the best disinfectants, and we’ll be working to keep the spotlight on crypto’s dirty deeds and its influence buying activities.
Learn more about Better Markets’ work on crypto here.