Table of Contents
Main conclusions
Cryptocurrency exchange FTX CEO Sam Bankman-Fried donated $2 million to political groups in 2022, which is the 27th largest donation on record. So far, he has donated more than $21 million in total to Democratic candidates and PACs. Two more FTX executives, Ryan Salame and Nishad Singh, donated another $1 million each Bankman-Fried was also among Joe Biden’s top funders in the 2020 presidential campaign, while his 2024 election spending could reach $1. billion Salame, however, has taken a Republican line with its funding, but there doesn’t seem to be a strict partisan line taken by either. Oregon, Michigan and North Carolina have banned cryptocurrency-denominated donations, but more states have legalized it or are considering introducing a framework to do so – California has just announced a turnaround on its previous ban.
Introduction
FTX has its hands in a lot of pots. This extends to politics as well. “You quickly run out of really effective ways to make yourself happier by spending money,” FTX CEO Sam Bankman-Fried has said in the past. “I don’t want a yacht.” Bankman-Freid may not want fancy toys, but he wants to influence the world, and that has partially manifested itself in a number of political donations. None more prominent than Joe Biden, with the current president receiving $5.2 million from Bankman-Fried during the 2020 presidential race. In total, he has donated more than $21 million of his money to various Democratic candidates and PACs. aligned with the Democrats so far. As for the 2024 elections? Bankman-Fried says he could spend up to $1 billion depending on the candidates (not the party), with the floor likely to be “north of $100 million”.
6) In the end I care about policy, not politics, and I don’t think either party has a monopoly on good ideas. My contributions could be substantial, or not; and their party breakdown will depend on the candidates and policies. — SBF (@SBF_FTX) May 25, 2022
California legalizes cryptocurrency donations
Many of these donations can even be made in cryptocurrencies rather than conventional fiat money. While several states have no rules on the legality of donating to political figures in cryptocurrencies, several states have already fully legalized it — including Washington, Arizona, Colorado, Illinois, Ohio, and Georgia. The map below shows, however, that some states have gone in the other direction, with California, Oregon, Michigan and North Carolina completely banning political donations via cryptocurrency. However, at the time of writing this article, California has turned to legalizing donations – meaning the chart below will imminently have yet another legalized state.
FTX heavily involved in politics
Bankman-Fried is not the only donor within cryptocurrencies. He’s not even the only one in FTX. Looking at donations so far in 2022, opensecret.org placed Bankman-Fried at 27th with $2 million in funding. However, two more FTX executives – Ryan Salame and Nishad Singh – donated another $1 million each, 44th overall. Despite the cryptocurrency’s price drop this year, it has advanced far into the mainstream, and perhaps nothing symbolizes that more than its growing involvement with politics. The combination of these three FTX donors alone would place the exchange 14th in the overall political donor rankings this year. Interestingly, Salame’s funding appears to be Republican-driven, putting funds into the American Dream Federal Action in May, which contrasts with the pro-Democrat stance of FTX colleague Bankman-Fried. Even Bankman-Fried has made smaller donations in the past to Conservative candidates, so apparently it’s not strictly partisan, as he stated above. Indeed, the Democrat-Republic divide on cryptocurrencies is fascinating, with the latter appearing to be the most sweeping in the industry as Democrats worry about money laundering, environmental damage, and investor exploitation.
Similar to previous elections
While cryptocurrency has been several orders of magnitude lower in past presidential campaigns, the growth in the use of cryptocurrency as a donation vehicle brings reminders of past elections. Donald Trump leveraged the power of social media – specifically Twitter – in his shocking victory in 2016, while Obama used smartphone technology enthusiastically four years earlier. These new methods of infusing technology into campaigns can go a long way toward winning over voters, particularly the younger generation, or those who might be less inclined to vote otherwise.
Polarization
Cryptocurrency remains an extremely polarizing issue, with naysayers claiming it is a fad and nothing more than a get-rich-quick scheme, while advocates say blockchain technology can make the world a better, fairer and more equitable place. It is not surprising, therefore, that this is starting to link more and more to cryptocurrencies. We’ve seen some politicians – President of El Salvador, Mayor of Miami, Mayor of New York, to name a few – enthusiastically embrace the technology, while others have called for it to be contained – China has banned it outright, for example. As the industry continues to grow despite the recent low prices, cryptocurrency regulations and politicians’ attitudes towards the industry will become increasingly important – particularly if FTX’s political endowments begin to spill over to the rest. of the industry. However, more states are expected to follow California soon, as legalizing crypto-denominated donations is an easy win for lawmakers — it doesn’t delve into the more complex regulatory issues surrounding the industry, while at the same time encouraging Native Americans. of crypto to donate.
Sources
https://www.opensecrets.org/outsidespending/summ.php?disp=D https://decrypt.co/47292/one-of-joe-bidens-biggest-donors-runs-a-cryptocurrency-exchange https: //s3.amazonaws.com/multistate.us/production/articles/abBqAY8jQcuZfeDxD/body/upload-572d89.png
