Bárbaros fuera de las puertas electorales: las ballenas criptográficas erosionan silenciosamente la arena política estadounidense
Original author: Wu Tianyi, DeThings
On July 23, according to the FEC official website, the blockchain group FairShake has become the largest super political action committee (Super PAC) in this election cycle, raising more than $200 million. According to CoinDesk, the fund has so far supported more than 20 members of Congress to win primary elections in the 2024 election. The vast majority of funds are managed through a coordinated group of PACs under Fairshake. The company behind the Fairshake PAC and its affiliates refused to answer questions about its origins or its ongoing relationship with the organization.
A PAC is an abbreviation for a Political Action Committee, which is an organization that collects and uses funds to support or oppose political candidates. PACs generally follow specific contribution restrictions and reporting rules and operate within contribution limits for individuals and entities. They can also donate directly to a candidates campaign.
Super PACs, on the other hand, have the ability to raise and spend unlimited amounts of money but are not allowed to make direct contributions to candidates or parties.
Fairshake PAC was co-founded by more than a dozen cryptocurrency companies in 2023 and has become one of the highest-spending PACs in the 2024 election cycle. Crypto-friendly venture capital firm Andreessen Horowitz, cryptocurrency trading platform Coinbase, veteran venture capitalist Ron Conway, venture capital executive Fred Wilson, tech executives Cameron and Tyler Winklevoss, and crypto solutions company Ripple have all donated to Fairshake.
Currently, Fairshake PAC is openly influencing American politics. Kara Calvert, head of Coinbases US policy, once said that Coinbase is committed to educating members of Congress so that when they are asked about cryptocurrency at town hall, or when they are asked about cryptocurrency by Fairshake or any other organization, they better know what they are talking about.
Various crypto institutions represented by Fairshake PAC are no longer satisfied with keeping themselves behind the scenes. Cryptocurrency practitioners and enthusiasts will choose a president for themselves:
“Fairshake supports candidates who are committed to ensuring America is home to the next generation of Internet innovators.
Providing blockchain innovators with the ability to develop their networks within a clearer regulatory and legal framework is critical if the broader open blockchain economy is to reach its full potential in the United States.”
Any discussion of effective altruism has disappeared
Cryptocurrency’s initial entry into the political arena began in 2021, when the first major surge in cryptocurrency lobbying occurred, as various aspects of the industry (Bitcoin, alternative currencies, NFTs, blockchain) gained mainstream exposure, political recognition, and wild valuations as lockdowns sparked interest in virtual economies and get-rich-quick schemes. The then-nascent Biden administration had already turned its attention to cryptocurrency regulation, with the SEC filing securities charges against Ripple in February of that year while also approving the listing request of cryptocurrency exchange Coinbase. One of the company’s largest investors, the well-known venture capital firm Andreessen Horowitz, poured money into other cryptocurrency players and launched an aggressive lobbying campaign to protect the industry from tax reporting and money laundering regulations—most importantly, to exclude it from SEC oversight.
The results came quickly: Before its passage in November, Biden’s infrastructure bill contained extensive tax reporting requirements for Bitcoin miners, but those requirements were significantly watered down due to aggressive lobbying.
Members of the Biden administration and members of Congress (regardless of party) such as Senators Kirsten Gillibrand and Cynthia Lummis, who were feted by several crypto leaders including Grayscale, the Blockchain Association, the Chamber of Digital Commerce, BTC Inc., and others, introduced a bill during the summer 2022 cryptocurrency crash that would achieve the lobbyists’ goals of transferring governance away from the SEC and exempting digital assets from certain tax requirements, such as capital gains taxes.
There is also a key lobbyist in this, former FTX founder Sam Bankman-Fried, and the senator who received cash from SBF has proposed a more relaxed bill that would also bring cryptocurrencies under the supervision of the Commodity Futures Trading Commission.
However, after FTX collapsed in late 2022, it was discovered that SBF, one of the biggest spenders in US campaigns at the time, was primarily responsible for covering up a Ponzi scheme, and all politicians who shook hands with SBF received “extra attention,” and the crypto industry’s enthusiasm for handouts waned. The industry, already hurting from the effects of rate hikes and the misdeeds of companies like Terraform Labs and Celsius (and eager lobbyists), seemed ready to back off for now, as evidenced by the notable lack of crypto advertising at the 2023 Super Bowl.
AI and Web3 join forces to disrupt the market
After FTX collapsed, the Biden administration began going after every major cryptocurrency company, scoring some major legal victories along the way—for example, Binance, once the world’s largest cryptocurrency exchange, saw its business completely collapse due to U.S. and international prosecutions. (Its former CEO Changpeng Zhao was forced to leave the company and the cryptocurrency space and was sentenced to four months in prison.) The day after filing the lawsuit against Binance, the SEC also sued Coinbase, the largest cryptocurrency exchange in the United States, accusing it of acting as an unregistered securities agency—a lawsuit that, if successful, could completely destroy Coinbase’s business model.
But a few weeks after SBF’s collapse, another seed for the cryptocurrency lobby’s comeback was planted: the launch of ChatGPT.
As the impressive chatbot became one of the fastest-growing apps of all time, crypto bros and their investors noticed the rapid adoption of the technology by consumers and professionals, and realized they had an opportunity to build a natural alliance. The CEO of ChatGPT’s parent company, OpenAI, is also a crypto enthusiast and has a stake in Andreessen Horowitz-backed biometric cryptocurrency project WorldCoin.
Thriving AI startups and companies also need a lot of infrastructure to handle their resource-intensive technology — and struggling cryptocurrency miners have a lot of idle infrastructure, including data centers, cooling systems and energy connections, that companies need to catch up with OpenAIs progress. Financially struggling digital asset experts have discovered that they can take advantage of the investment hype around AI by incorporating the technology into the crypto process, and the value of these so-called AI tokens has indeed soared, just like every other AI-related company today.
But beyond material interests, cryptocurrency enthusiasts and AI bulls have something more important in common: a desire for unchecked growth and an aversion to regulatory burdens.
Effective accelerationists believe that any slowdown in AI development is dangerous to the mission of advancing life-changing AI that can take humanity to new frontiers and make a lot of money for its practitioners. They march under the mantra of the “Techno-Optimist Manifesto,” which encourages all technologies to develop unhindered—without government intervention or regulation.
The most outspoken bitcoin and cryptocurrency advocates, including Coinbase’s Brian Armstrong, embrace this philosophy, and it’s changing the way they lobby.
The result is a sharp turn to the right in crypto activity. The Biden administration’s crackdown on cryptocurrencies and attempts to set guidelines for artificial intelligence have angered both industries, with technologists eager for a radical change — one that’s more libertarian and generally hands-off.
From chess piece to chess player
At the same time as Coinbase launched its Stand With Crypto campaign in August 2023, Brian Armstrong announced that he and his company would donate to the super PAC Fairshake.
Fairshake PAC has thus entered the American political arena, with its chief spokesman and organizer being Josh Vlasto, formerly an assistant to the current Senate Majority Leader and former New York governor.
While running Fairshake, Vlasto also coordinated the billionaire-backed Peace Facts, a pro-Israel group formed after October 7 to shape the information environment surrounding the Gaza war. In the early months of the war, Peace Facts was one of the largest ad buyers online, spending nearly $500,000 on targeted ads to combat online criticism of Israel.
The huge spending figures for cryptocurrency in this election year were boosted by the virtual currency’s recent rally. Bitcoin prices jumped to an all-time high of $73,000, in part because of a slowdown in mining that has limited supply. (BTC is currently trading at $69,000.)
The Biden administration fueled this market rally and helped make a lot of money for donors who are now spending money on campaigns. But SEC Chairman Gary Gensler remains a staunch opponent of cryptocurrencies. So Fairshake PAC, with its deep pockets, is carefully selecting campaign targets, rooting out politicians who are critical of the industry, and cultivating new allies in both parties to replace them.
The most famous impact was in March of this year, when Katie Porter, a radical Democratic star, raised more than $30 million in her campaign and had a good chance of winning a California Senate seat. However, Porter follows Elizabeth Warrens political line and played an important role in Harris fight against banks, so Fairshake identified her as a potential anti-crypto ally of Warren.
During the California primary, Fairshake spent more than $10 million to undermine Porter’s young voter base. Banners hung over Hollywood and vans on the Walk of Fame were filled with pointed comments about Porter, who misled voters into accepting bills that benefited big business. In the end, Fairshake hedged about a third of Porter’s campaign funds, causing her to fall behind fellow Democrat Adam Schiff and fail to make the general election in the fall.
Leveraging Republican control of the Senate
Whether the cryptocurrency can claim that its ads influenced the outcome of the primary in a large state like California is debatable, but Fairshake is certainly trying to swing the Senate toward Republican control in order to gain more influence in the House of Representatives.
Republicans are generally more inclined to deregulate cryptocurrencies, so the mission of these PACs is to gain a larger foothold within the Democratic Party. Fairshake’s largest donors, Ripple, Andreessen Horowitz, and Coinbase, have donated more than $1 million to the House Majority PAC, the campaign spending arm controlled by House Minority Leader Hakeem Jeffries (D-NY). Coinbase has also donated $500,000 each to the Republican Senate Leadership Fund and the Democratic Senate Majority PAC, according to campaign finance analyst Open Secrets.
Two races were particularly symbolic of crypto PACs choosing to back friendly Democrats in crowded open seats.
In Alabamas new majority-black 2nd Congressional District, which is heading into a Democratic primary runoff, Shomari Figures is expected to outpace his opponent thanks to $1.7 million in campaign funds from the group Protect Progress.
In Texas’ 32nd District, Julie Johnson, who recently won the contentious Democratic primary to unseat Colin Allred, who was running for U.S. Senate, has also benefited from cryptocurrency funds.
Like Adam Schiff, both Figes and Johnson opened a section on their campaign pages dedicated to supporting cryptocurrency, in a clear signal to super PACs to solicit financial support from the industry. However, these initiatives do not seem to matter to voters, and cryptocurrency has never been listed in the top 20 priorities in the issue survey.
In some races, cryptocurrency groups don’t have to spend any money at all to influence politicians’ behavior. Fairshake said it still plans to participate in Senate races in Michigan and Maryland, but has not yet chosen a side. The looming threat is already affecting candidates’ positions.
In the Maryland Democratic primary, Democratic Rep. David Trone and Prince George’s County Mayor Angela Alsobrooks both expressed an openness to cryptocurrencies, though they have not previously taken a hardline stance. Trone co-signed a letter with cryptocurrency critic Elizabeth Warren last year calling for stronger enforcement, but has more recently been echoing industry views. Trone said he believes in legal certainty for cryptocurrency companies so that the U.S. does not “fall behind in the global race for technological advancement and economic competitiveness.”
Alsobrooks also praised blockchain technology, emphasizing that it can help all Americans, including traditionally underserved communities, have the opportunity to create generational wealth for their families.
This phenomenon is not only happening in the electoral sphere, but also directly in messages sent to incumbent officials. According to CNBC, a dark money nonprofit called Cedar Innovation Foundation, which “receives significant funding from cryptocurrency industry participants,” ran ads encouraging cryptocurrency enthusiasts to ask Ohio Senator Sherrod Brown to oppose SEC Chairman Gary Gensler and Senator Elizabeth Warren.
American businessman and investor Ben Horowitz wrote a blog post in December denouncing misguided and politicized regulation, condemning lobbyists who often work against a positive technological future, and announcing that the company would pursue its political interests thusly: If candidates support an optimistic technology-enabled future, we support them. If they want to stifle important technologies, we oppose them. These important technologies include artificial intelligence and decentralized technologies from the blockchain/crypto/web3 ecosystem.
It is not difficult to see that deregulation may have become a common demand in the rapidly developing technology sector. After Trump shouted at the 2024 Bitcoin Conference that he would fire the current SEC chairman as soon as he took office, this sentiment reached its peak, and Trump also transformed himself into the crypto savior. However, at the same time, an interesting data is that Fairshake has raised $202 million, even quietly surpassing MAGA led by Trump.
Referencias:
https://slate.com/news-and-politics/2024/05/crypto-politics-2024-elections-fairshake.html
https://www.inc.com/sam-blum/andreessen-horowitz-announces-foray-into-political-donations.html
https://crypto.news/crypto-super-pac-fairshake/
https://www.politico.com/news/2024/03/05/super-tuesday-set-to-test-cryptos-post-sbf-sway-00144900
https://prospect.org/politics/2024-04-03-staying-power-crypto-political-machine/
https://www.opensecrets.org/political-action-committees-pacs/fairshake-pac/C00835959/summary/2024
https://www.fairshakepac.com/https://iq.wiki/wiki/stand-with-crypto-alliance/
https://cointelegraph.com/news/crypto-super-pac-fairshake-top-funding-spot-beats-maga-open-secrets
https://cointelegraph.com/news/crypto-super-pac-fairshake-top-funding-spot-beats-maga-open-secrets
This article is sourced from the internet: Barbarians outside the election gate: Crypto whales quietly eroding the US political arena
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