Elizabeth Howcroft and Hannah Lang
AMSTERDAM/NEW YORK (Reuters) – The president of a U.S. crypto firm is “optimistic” that the crypto industry’s lobbying efforts will bear fruit in this year’s U.S. elections, after her company helped the industry lead record fundraising to support political candidates who are crypto -friendly. San Francisco-headquartered Ripple is the second-largest donor to Fairshake, a so-called super PAC that raised $92.9 million in an attempt to sway November’s congressional elections in favor of the crypto industry, according to research group OpenSecrets. which tracks influence in politics. Super PACs backed by the cryptocurrency sector have raised more than $102 million this cycle, the third-highest of any Super PAC running in the 2024 election, according to Public Citizen.
Independent political action committees, known as super political action committees, can raise unlimited amounts of money from corporations, unions, associations and individuals, and then spend unlimited amounts to openly advocate for or against political candidates.
Speaking at the Money20/20 fintech conference in Amsterdam on Tuesday, Ripple President Monica Long told Reuters that the PAC is bipartisan and has a single goal: supporting candidates who support the regulations desired by the crypto industry.
“I think as an industry, especially U.S.-based companies, we’re frustrated by how behind the U.S. is in setting regulations,” she said. “This whole dynamic of making rules by enforcing them … is really counterproductive and will get us nowhere.”
When asked if she hopes the voice of the US crypto industry will be heard, Long replied: “I’m optimistic, yes. I hope”.
The crypto industry is increasingly trying to influence U.S. lawmakers as it faces increased scrutiny from regulators and politicians, especially after the 2022 bankruptcies of major crypto firms spooked investors, exposed fraud and misconduct and left millions of crypto investors out of pocket.
US securities regulators have sued several leading crypto firms, including Ripple, for alleged violations of securities laws. In July, a federal judge ruled that Ripple’s sale of its XRP token to sophisticated buyers constituted an illegal sale of unregistered securities, but also ruled that sales of XRP on public exchanges did not meet the legal definition of a security.
The Securities and Exchange Commission is seeking fines and penalties totaling $2 billion from the company, Ripple said.
Crypto groups are pushing lawmakers to pass a bill that would limit SEC oversight of the industry. A Public Citizen report found that roughly half of the crypto industry’s political war chest comes from direct corporate spending, primarily from cryptocurrency exchange Coinbase (NASDAQ:) and Ripple, with the rest contributed by venture capitalists. However, the industry’s own data suggests that lobbyists may have difficulty gaining support. A survey by the American crypto company Digital Currency Group, published in May, showed that only 14% of voters in US states whose results could affect their own cryptocurrency among both Democrats and Republicans, and 69% of them have a negative view of cryptocurrency, compared with 31% feeling positive. “While most voters are dissatisfied with the current financial system, only a minority believe that cryptocurrency is the future of transactions or a new path to prosperity,” the report said. US President Joe Biden, a Democrat, last week vetoed what he called a Republican-led resolution that would “inappropriately limit the SEC’s ability to establish appropriate protections and address future challenges” related to crypto assets. SEC Chairman Gary Gensler has previously called the crypto industry a “Wild West” riddled with fraud and investor risks.
Ripple’s Long said the SEC appears to have been on a “warpath” with the crypto industry in recent years and that everyone is hoping for a “change of tone.”