Crypto is having its coming-out party on Capitol Hill, regardless of who comes out on top in November’s elections. A slate of pro-crypto candidates is expected to join the next Congress, spanning the ideological gamut from Democrats who say the technology could bring disadvantaged Americans into the financial system to Republicans who view it as a tool for escaping authoritarian government oversight. That shift will largely be due to the millions of dollars the crypto industry has poured into races this year to support candidates backing the sector, and turn a technology that barely existed a decade ago into a major lobbying force. Jordan Libowitz, vice president for communications at the Citizens for Responsibility and Ethics in Washington, said, “When it comes to new players on the scene, there has not been something to just explode like this… from an industry that spent very little to being arguably the biggest spender of the election cycle,” speaking with POLITICO’s Jasper Goodman as part of a sweeping overview published today of the incoming crypto class. Crypto’s long, tortured development as a technology has seen it grow from a libertarian or cryptographer’s hobby software, to a messianic “currency of the future,” to the SPAC-and-Super Bowl-ad-era’s scammy asset class to now a steady financial industry with major asks of Washington for how it’s regulated. Jasper writes that despite the relatively small number of Americans who regularly use or trade crypto (a Federal Reserve report found that 7 percent of adults “held or used cryptocurrency in 2023”), the industry has poured vast resources into making sure it punches above its weight in removing regulatory barriers to the technology’s adoption. The industry has spent $160 million on candidates on both sides of the aisle in the House and Senate, but a few key races stand out because of their ability to influence who controls Congress. Foremost among them is the Senate race in Ohio between Democratic incumbent Sen. Sherrod Brown and Republican challenger Bernie Moreno, a businessman and founder of a blockchain startup. The pro-crypto super PAC Defend American Jobs, funded by Coinbase, Ripple and Andreessen Horowitz, has spent $40 million in Ohio to knock out Brown, a major crypto skeptic. (It would also all but guarantee Republican control of the Senate, something many in the crypto industry favor.) But crypto has also popped up in some races further down the ballot, reflecting the industry’s desire to cement itself as a regulatory force. Crypto groups spent in Democratic primaries to support industry allies like Shomari Figures of Alabama (a one-time industry critic and ally of Brown), Emily Randall of Washington, Yassamin Ansari of Arizona, Julie Johnson of Texas, and Eugene Vindman of Virginia. The industry spent $3.4 million in primaries knocking off progressive Reps. Cori Bush (D-Mo.) and Jamaal Bowman (D-N.Y.). Pro-crypto Rep. Wiley Nickel (D-N.C.) said the moves would lead to “a lot more forward-looking people who understand that digital innovation is really important for our economy” in the House, but they could have allies in the Senate as well. Crypto boosted Rep. Adam Schiff (D-Calif.) in his primary against industry foe Rep. Katie Porter (D-Calif.), and backed Reps. Ruben Gallego (D-Ariz.) and Elissa Slotkin (D-Mich.), who both voted in favor of an industry-supported bill earlier this year. Still, with former President Donald Trump launching a crypto project and the official 2024 Republican platform pledging to “end Democrats' unlawful and unAmerican Crypto crackdown,” the GOP is more in lockstep than Democrats on crypto — and the industry’s donations reflect that reality. While crypto largely targeted open primaries for Democrats in safe seats, it’s spending on pro-crypto Republicans who are up for tough re-election battles, including California Reps. Michelle Steel, David Valadao and Mike Garcia. If the industry’s newfound muscle pays off, pro-crypto members of Congress say it could transform how Washington relates to the technology no matter who becomes president. Rep. Mike Flood (R-Neb.), a pro-crypto member of the House Financial Services Committee and beneficiary of the industry’s donations, said that come January, “The people that have been naysayers on crypto are going to find that there’s a lot more members that are educated on it and want to go for it.”
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