A growing number of political action committees (PACs) with a cryptocurrency concentration, such as Fairshake, are making large financial contributions to Senate campaigns.

These organizations, which are supported by well-known names in the cryptocurrency space, seek to aid political candidates who share their outlook on the direction that blockchain technology and cryptocurrencies will take.


The significant $10 million campaign against cryptocurrency opponent and Democratic candidate for the California Senate, Katie Porter, who recently lost her race, demonstrated the influence of political action committees (PACs).


Porter is well-known for taking a tough stance on issues of how cryptocurrency mining affects the environment.

With contributions from major players in the industry including Coinbase, Ripple Labs, and Andreessen Horowitz, Fairshake's war fund has surpassed $85 million.

Why the extreme involvement? The crypto business is in a critical phase right now. It is attempting to overcome the regulatory obstacles, battling public distrust, and, most importantly, pursuing legitimacy.

Let's look into the objectives of these wealthy political action committees and how they affect Senate contests.
 

Recognizing the political impact of cryptocurrency

These PACs employ a more comprehensive strategy than merely providing funding. They are actively participating in competitive states, capitalizing on their victories—like the large sum of money they invested to unseat Rep. Katie Porter in California—to advance to more significant Senate races.

These political action committees, headed by Fairshake, are raising a significant amount of money—not to mention the Winklevoss twins' $4.9 million contribution—to back pro-crypto candidates and oppose opponents.

Surveys indicate that the percentage of "crypto voters" in the United States is rising, accounting for 44% of all votes. Election results may be influenced by individuals who possess or consider possessing digital assets.
 

Political campaigns are starting to focus heavily on cryptocurrency as several candidates endorse and embrace blockchain technology as a major component of their platforms.

Future elections may see a significant focus on digital assets because politicians such as Ted Budd, Blake Masters, Tim Ryan, and JD Vance have made crypto-friendly legislation a key component of their previous campaigns.

How far does Fairshake go?

Fairshake centers on four pivotal Senate contests: the Democratic primaries in Maryland and Michigan, as well as the general elections in Montana and Ohio.

The decision was made in light of the Democratic senators in Montana and Ohio who are currently in office. It is well known that these senators are dubious about cryptocurrencies, and in 2020, Donald Trump prevailed in the state election.

Senator Jon Tester of Montana had questioned the existence of cryptocurrencies, while Senator Sherrod Brown of Ohio had previously proposed a national crypto ban.

Fairshake's strategy is more intricate, though. The PAC suggests that these senators could still receive Fairshake's support if they modify their opinions to be more crypto-friendly, instead than taking a direct opposing stance.
 

The Political Action Committee is venturing into uncharted territory in the Democratic primaries held in Maryland and Michigan. The political campaigns of Congresswoman Elissa Slotkin of Michigan and David Trone of Maryland, among other contenders, have not made a big deal out of cryptocurrency.

While neither major contender in Maryland has made a clear public position on cryptocurrency, Slotkin has restricted her public remarks about the subject to openness in lawmakers' cryptocurrency dealings.

The sharp rise and fall of Sam Bankman-Fried and his cryptocurrency exchange FTX, which previously contributed millions to congressional campaigns, serves as the background for this calculated drive.


A new stage in this involvement is being facilitated by Fairshake and its allied PACs, Protect Progress and Defend American Jobs, who seek to support politicians who are likely to favor laws that will encourage the development of the cryptocurrency industry.

The SEC's tight grip

The regulatory landscape set by the SEC under both the current and prior administrations is primarily responsible for the strong attitude taken by PACs endorsing cryptocurrency in the approaching elections.

Under Chairman Gary Gensler, the SEC has significantly stepped up its regulatory measures and examination of the cryptocurrency space, characterizing it as a “wild west” devoid of sufficient investor protection and characterizing the sector as “rife with fraud, scams, and abuse”.

A lot of people, including Coinbase CEO Brian Armstrong, believe that these actions are stifling innovation and giving established financial institutions an unfair advantage. As a result, this viewpoint has led to significant enforcement actions, including against prominent players like Binance and Coinbase, accusing them of running unregistered exchanges and selling unregistered securities.

The regulatory approach adopted by the SEC has resulted in a deterrent effect on decentralized finance (defi) initiatives and the wider cryptocurrency ecosystem. Developers and entrepreneurs are hesitant to pursue innovations due to the possibility of SEC enforcement actions.

Furthermore, by being classified as securities, well-known cryptocurrencies like Cardano (ADA), Ripple (XRP), and Solana (SOL) are subject to strict laws that could impede their growth and limit their use in DeFi projects.


PACs like as Fairshake have stepped up their efforts to support candidates who support a more innovative regulatory framework for cryptocurrencies in response to these and other comparable regulatory challenges.

Their efforts point to a combination of political campaign activity, policy advocacy, and financial clout, with the goal of influencing not just the current electoral cycle but also the direction of crypto regulation and acceptability in the American political mainstream.