$263 million in crypto capital enters the market: U.S. midterm elections become a new battleground for policy competition

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Chaincatcher2025/10/29 20:21

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By:原文作者：Annie Massa、Olga Kharif、David Pan，彭博社

This time, there are more super political action committees, and some of them have taken a clearer stance in aligning themselves with Republican candidates.

Original authors: Annie Massa, Olga Kharif, David Pan, Bloomberg

Translated by: Luffy, Foresight News

After achieving success in the 2024 U.S. presidential election, the crypto industry is ramping up its investment for the 2026 midterm elections.

According to Federal Election Commission (FEC) filings and public statements, several crypto-focused Super Political Action Committees (SPACs) are raising about $263 million. This amount is nearly double the investment made by the largest SPAC, Fairshake, in 2024, and slightly exceeds the total spending of the entire oil and gas industry in the previous election cycle, according to OpenSecrets data.

Following the crypto industry’s massive investment in 2024, the Republican Party took control of both chambers of Congress, lawmakers passed multiple crypto-friendly bills, and appointed supportive regulators to key positions. This influence was evident again last week: President Donald Trump pardoned Binance co-founder Zhao Changpeng, who had previously admitted to violating U.S. anti-money laundering laws and was sentenced to four months in prison during the Biden administration.

Legislative victories and the Trump family’s embrace of crypto have prompted some newly established SPACs to shift away from previous strategies, more explicitly supporting the Republican Party to help consolidate its control of Congress.

The crypto industry is also leveraging political donations to advance a series of legislative and regulatory priorities, with the recent core focus being the crypto market structure bill. This bill would overhaul the regulatory framework for digital assets and could grant the more crypto-friendly Commodity Futures Trading Commission (CFTC) greater authority.

$263 million in crypto capital enters the market: U.S. midterm elections become a new battleground for policy competition image 0

SPACs’ midterm election budgets

To push the bill forward, about 12 top crypto industry executives traveled to Washington last week. Despite ongoing government shutdown negotiations, they held an hour-long meeting (UTC+8) with a group of senior Republican senators and a longer meeting (UTC+8) with Democratic senators, including Minority Leader Chuck Schumer.

“The industry’s success in 2024 has built a roadmap—whether you’re a CEO or an ordinary user, it’s now proven that crypto has a voice and can influence elections,” said Cody Carbone, CEO of the Washington lobbying group The Digital Chamber. “There will be more participants in the future, and more money will be invested.”

Crypto companies and executives are supporting policymakers and Trump’s initiatives in various ways. Some crypto companies have already struck business deals with the Trump family’s crypto ventures, while others have donated to the January inauguration and June parade. In addition, several companies are funding the new $300 million White House banquet hall. According to the White House, these include Coinbase, Ripple, and the U.S. branch of stablecoin giant Tether.

U.S. President Donald Trump displays a model of the planned Arc de Triomphe at a dinner with business executives, highlighting the new White House banquet hall project

Besides the White House, SPACs are also a focus for members of Congress, who have the power to draft industry-related legislation.

According to public statements and FEC data, Fairshake remains the largest crypto SPAC, holding $141 million as of the end of June. OpenSecrets data shows the organization spent over $133 million in 2024 to support crypto-friendly candidates, making it one of the highest single-issue spenders in the previous election cycle. Its backers include major U.S. crypto companies such as Coinbase and Ripple, as well as venture capital firm Andreessen Horowitz.

In 2024, Fairshake and its two affiliated groups attempted to make crypto-friendly policies a bipartisan issue. For example, the organization contributed about $10 million (UTC+8) each to Democrats Elissa Slotkin and Ruben Gallego, helping them win Senate seats in Michigan and Arizona, respectively. Both senators were among the 18 Democrats who voted for the GENIUS Act, which paved the way for stablecoins favored by the crypto industry to be more widely integrated into the financial system.

But even in 2024, most of Fairshake’s election-stage funding still went to support Republicans, including spending $40 million (UTC+8) to successfully defeat then-Senate Banking Committee Chair, Ohio Democrat Sherrod Brown.

In November 2024, Senate candidate Elissa Slotkin addresses supporters at an election night event in Detroit

This time, there are more SPACs, and some have more clearly aligned themselves with Republican candidates.

Last month, World Liberty Financial, a crypto project co-founded by the Trump family and presidential envoy Steve Witkoff’s family, announced its support for the Digital Freedom Fund SPAC. This PAC was established in August by Gemini exchange co-founders Tyler Winklevoss and Cameron Winklevoss, who stated on X that they would donate $21 million (UTC+8) in bitcoin to support advocates of President Trump’s crypto agenda in the primaries and midterms. According to sources, the organization plans to target Sherrod Brown, who is seeking to return to the Senate.

In July, Gemini co-founders Cameron Winklevoss (left) and Tyler Winklevoss (right) speak with President Donald Trump at the White House GENIUS Act signing ceremony

Another newly established group is the First Principles Digital PAC, which describes itself as a “Republican-led, Republican-focused organization dedicated to electing pro-crypto leaders.” Led by Republican strategist Jason Tillman and founded after the 2024 election, FEC filings show it had about $954,100 (UTC+8) in cash reserves as of the end of June. The organization has already supported Mike Rogers, who will run for a Michigan Senate seat in 2026.

Recently, Fellowship PAC announced its formation in September and pledged to donate $100 million (UTC+8). Its donors have not yet been disclosed, but initial filings show its treasurer is an executive at financial firm Cantor Fitzgerald—which was previously led by Trump administration Commerce Secretary Howard Lutnick.

Representatives for Digital Freedom Fund, Fellowship, Fairshake, and First Principles Digital PAC all declined to comment.

The biggest wildcard is Tether. The stablecoin company, headquartered in El Salvador, has close ties to Cantor Fitzgerald. The New York Times reported that Fellowship PAC’s supporters are expected to include Tether, which recently established a U.S. entity.

In August this year, Tether announced it would launch U.S.-based products and hired Trump’s former core crypto policy advisor Bo Hines to lead the effort.

Tether CEO Paolo Ardoino said in an interview last week that the company is in talks with several PACs. Foreign companies are prohibited from donating to SPACs, but Tether’s new U.S. foothold may qualify it to make donations.

On October 2, Tether CEO Paolo Ardoino speaks at the Token2049 conference in Singapore

Faced with the crypto industry’s financial offensive, Democrats are increasingly concerned.

Eric Baulsbaugh, who previously worked for the Elizabeth Warren and Hillary Clinton campaigns, serves as executive director of the newly formed group Open Frontier, which aims to align more progressive voices with the crypto industry.

“Many people in my camp are still trying to understand this industry,” Baulsbaugh said. “Right now, there isn’t a reliable spokesperson, and the crypto industry’s credibility has been severely damaged.”

When crypto executives visited Washington to meet with lawmakers last week, partisan divisions were evident. Chainlink Labs co-founder Sergey Nazarov, who attended, said Republicans—including Senate Banking Committee Chair Tim Scott of South Carolina—explicitly expressed alignment with industry priorities; Democrats, on the other hand, raised sharp questions about crypto’s use in money laundering and decentralized finance.

“I don’t think Democrats really understand our industry yet; they’re worried about illicit finance issues,” Nazarov said.

Others point out that the industry’s huge funding and newfound political influence are forcing at least some Democrats to reconsider their positions. Even previously tough-talking Brown has softened his rhetoric.

“Crypto has become a part of the U.S. economy and is increasingly popular in Ohio and across the country,” Brown’s campaign manager Patrick Eisenhower said in a statement. As more people adopt digital assets, Brown wants to ensure “it can expand opportunities, improve the lives of Ohioans, and not put them at risk.”

In 2024, Senator Sherrod Brown at a Senate campaign event in Ohio

The demands of crypto industry executives go beyond the Republican hope of passing the market structure bill before the midterms; they also include adjusting crypto tax policy, anti-money laundering and sanctions-related rules, and the regulatory framework for decentralized exchanges.

Some donors are also eyeing state and local elections, such as the New York City mayoral race. Crypto entrepreneur Brock Pierce donated over $1 million (UTC+8) to groups supporting Eric Adams just days before Adams withdrew from the race.

In Nazarov’s view at Chainlink Labs, there is a common thread in meetings with politicians. “They realize the economic value of this industry is huge, so they must clarify how to respond,” he said. “The industry will continue to grow, and they need to develop the right response.”