Crypto mammoths lobby hard as the election nears

The tech industry accommodated audiences with massive involvement rates when it came to political battles, ranking among the biggest lobbyists within the U.S. electoral landscape. This year, the crypto segment has taken the lion’s share, being deeply involved in political races as crypto giants have been dumping millions of greenbacks. To date, over $19MN has been spent for political purposes. The big crypto’s political splurge accounted for 48% of corporate money injected as political contributions. Actually, since 2010, cryptocurrency companies have represented the second-largest election-related financiers, falling behind only fossil fuel corporations. 

The news doesn’t come as a shocker for many if a moment is taken to look at how well the bitcoin price prediction has been doing lately. PACs also raise money, which they could splurge on national political battles this year, with more contributions likely to either come or be disclosed. Clearly, the crypto industry is flourishing this year, all the more if we compare it with the performances registered two years ago. But this isn’t the only catalyst for tycoons’ generous donations made for political purposes.

The lack of a federal regulation framework  

The registered influx of donations demonstrates that the digital currency industry is approaching a critical point in its attempts to leave a mark on the country’s policy. Considering that this segment is still in its developmental stages, having been around for less than two decades, it’s justifiable why companies find the fact that plenty of regulations are still up in the air objectionable.

Rewinding to 2022, the U.S. announced introducing a new framework that would pave the way for further regulation, handing power to the market’s watchdogs, the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC). By this time, the latter is monitoring and controlling the field, as shown by past complaints, lawsuits, and other similar legal actions taken against crypto tycoons, companies, products, services, and so on. 

Nevertheless, in 2023, several victories for the crypto sector brought it to more investors’ notice. An example is the labeling of Bitcoin and Ethereum as commodities in January and July instead of securities, as they had been previously adjudicated. This attracted new waves of investors to the table. At the same time, new crypto-based investment vehicles titled exchange-traded funds (ETFs) broke into the market and solidified crypto’s position within the industry. The ongoing clash between investors, brokers, dealers, regulators, issues, and the whole crypto sector speaks volumes about the industry’s progress in the U.S., irrespective of the already introduced frameworks and the control lawmakers have. 

And the game of who takes responsibility

Some issues are still under open question. Given that today’s focus remains directed toward elections, investors may have to sit on the bench for a bit more until they know who monitors and controls crypto. Even though securities like bonds and stocks are regulated by an agency, namely the SEC, which guides how to work with crypto, it’s difficult to say who may get to legalize and oversee digital currency. As far as these lawmakers are concerned, the current rules have brought many cryptocurrencies within its authority. 

However, the circumstances vary across the states, signaling the need for a straightforward, sensible agenda that can prove helpful regardless of an investor's context.

A second to look at political polarization

The concept of political polarization makes all the headlines and gets muttered everywhere, and for good reason. In layman’s terms, this notion boils down to the influence a business has in easing or intensifying political rifts. Some focus lies on the way mammoths exhaust greenbacks on charity efforts for political scopes. For the midterm elections marking 2022, firms’ contributions accounted for $3.5BN. How? Simply, campaigns would latch on to radio and television, mainly because those routes have the highest potential to send the intended messages to voters, who often spend most of their time on these channels. Political advertising is about matching the intended message with the right audience. 

This cycle, crypto companies spent at least $119MN on the elections in an effort to ease regulation on the sector they operate in. A bill backed by crypto tycoons would see cryptocurrencies regulated by the Commodity Futures Trading Commission (CFTC) instead of the currently ruling SEC.

Corporations may fail to see their efforts as a disseminator of polarization—or, at least, they’d rather deny such statements. The government impacts these companies’ actions and outcomes in numerous ways, from regulations on the energy they can use and how much they pollute the surroundings to the working conditions of their employees and to whom they distribute products.

Crypto makes a big splash with donations 

Campaign donations steal the spotlight, but often, it’s the big corporations who have the last word regarding how policy is shaped. The game of power and dynamics is on, and since Washington is where most rules are made, it was a matter of time until crypto mammoths dipped their toes in the waters of lobbying. 

Crypto firms may make the headlines, but it’s only so much that they can influence the election’s course. A crypto-friendly president is indeed the goal; yet, it’s safe to say that since crypto doesn’t rank high on voters’ list of problems and priorities, crypto's effect on elections may be louder instead of more effective. According to Gallop surveys, crypto isn’t among the first problems issued by voters. At the same time, around 7% of the nation holds amounts of crypto that matter. 

There’s limited power that crypto can exert.

As the election approaches, all eyes are on the powers that sway the decision that will be taken in November, influencing U.S. daily life for the whole mandate. Cryptos look to exert as much influence as possible. Yet, more factors contribute to the final decision. Stay close for more news, fresh from the oven