WASHINGTON, July 11, 2023 – A new OpenSecrets profile analyzes recent developments in the crypto industry and illustrates its influence on proposed regulation.
The task of regulating crypto has thus far been left to a patchwork of rules and guidance from the Securities and Exchange Commission, Commodity Futures Trading Commission and Treasury Department. One bipartisan caucus in Congress has objected to even that minimal oversight.
Crypto has been around for over a decade but the question of how it fits into the wider financial system remains up for debate. Whether it’s characterized as commodity, security or just an elaborate greater-fool scheme that converts mathematics into greenhouse gas, the technical underpinnings of blockchain-based financial products often obfuscate practical discussion of the industry.
Key takeaways:
- 2022 was a banner year for crypto industry lobbying. Total federal lobbying spending was more than double that in 2021. The number of crypto industry lobbyists exploded to 279, the majority of whom were revolving door hires who previously held jobs in the federal government.
- The top crypto industry lobbying spenders included Coinbase and Binance, two major crypto exchanges sued by the SEC in June 2023. Binance allegedly mishandled customer funds, while Coinbase was accused of violating the law by selling unregistered securities.
- Alongside the massive increases in lobbying spending, political contributions from crypto firms reached unprecedented heights during the 2022 election cycle. FTX was far and away the highest spender, despite having since collapsed after allegedly defrauding investors.
- The crypto industry’s top 10 beneficiaries in Congress include House Financial Services Committee Chair Patrick McHenry (R-N.C.) and Sen. Kirsten Gillibrand (D-N.Y.), both of whom have sponsored legislation to establish regulatory frameworks for digital currencies.
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