Ryan Selkis, a cryptocurrency executive, was dining at Mar-a-Lago last month when he received an unexpected invitation: Former President Donald J. Trump wanted to come up on stage and say a few words.
Mr Selkis, who runs crypto data firm Messari, was one of hundreds of attendees at an event celebrating Mr Trump’s series of non-fungible tokens, the digital collectibles known as NFTs. When he reached the lectern, Mr. Selkis turned to the former president.
“There are 50 million crypto holders in the US,” the executive said. “That’s a lot of voters.”
That message has become a political talking point in the crypto world as the industry tries to shake off a wave of scandals and establish itself as a powerful force in the 2024 election cycle. Three major crypto companies have come together to fund a group of affiliated super PACs, investing around $150 million to elect pro-crypto candidates in congressional races.
The PACs do not plan to participate in the presidential election, a spokesman for the groups said. But top crypto executives have tried to rally the industry behind Mr. Trump, who has reciprocated by praising cryptocurrencies and hosting executives at Mar-a-Lago.
Many crypto advocates see the 2024 election as a pivotal moment. After a string of crypto companies collapsed two years ago, the Biden administration launched an aggressive crackdown, bringing lawsuits and criminal charges against some of the industry’s top figures. The Securities and Exchange Commission is monitoring cases that could effectively force the crypto industry out of the United States.
“The 2024 election will be the most important in the history of crypto,” said Brad Garlinghouse, CEO of Ripple, a crypto company that has worked with the federal government for years. “You’re seeing a technology become a partisan political issue.”
Mr Garlinghouse, Mr Selkis and other executives have argued that the new “crypto voters” could influence the outcome of the election. They often cite a survey, commissioned by crypto exchange Coinbase, that suggests 52 million Americans own digital currencies. (The Federal Reserve estimates the total is 7 percent of the adult population, or about 18 million people.)
But voters’ supposed passion for crypto may be less important than the industry’s campaign war chest. Ripple, Coinbase and venture capital firm Andreessen Horowitz have each donated about $50 million to crypto PACs, which plan to spend those funds on several competitive Senate races. In March, the largest PAC, Fairshake, spent about $10 million on attack ads against Rep. Katie Porter, a Democratic candidate in the California Senate primary who was allied with Sen. Elizabeth Warren, a longtime crypto critic. Mrs. Porter lost her match.
“A single relatively small industry is literally trying to buy off enough politicians to take over the public agenda,” said Dennis Kelleher, president of Better Markets, a financial reform group. “It’s pretty exciting.”
The industry’s vast resources have turned a niche array of issues into a talking point in the presidential campaign. Robert F. Kennedy Jr., the independent presidential candidate, made his first official campaign appearance at a Bitcoin event in Miami and has attended many industry conferences, sometimes holding fundraising meetings with wealthy executives on the sidelines.
President Biden has long been seen as anti-crypto because SEC Chairman Gary Gensler has sued so many crypto companies. But some Biden supporters, including investor Mark Cuban, have pushed his campaign to mend fences.
The campaign was receptive to the message, Mr. Cuban said in an email. In recent weeks, Biden officials have reached out to Coinbase and Ripple, asking to discuss crypto policy, four people familiar with those discussions said.
However, much of the industry seems to be rallying around Mr Trump. While the former president once said Bitcoin “looks like a scam” and has frequently criticized the tech industry, he has made several supportive comments about cryptocurrencies in the past month, promising to end the regulatory crackdown. On Tuesday, Mr. Trump met at Mar-a-Lago with executives from some of the world’s largest Bitcoin mining companies, including Marathon Digital and Riot Platforms.
Bitcoin must be “MADE IN THE USA!!!” uploaded on his social network.
The last time the crypto industry spent big on a political race, its top donor was Sam Bankman-Fried, the founder of FTX, who spent tens of millions of dollars supporting both Democrats and Republicans in the 2022 midterms. .Two years later, Mr. Bankman-Fried’s company is bankrupt and he is serving a 25-year prison sentence for fraud.
The collapse of FTX was a huge setback for the efforts of the crypto industry in Washington. Last year, the SEC sued Coinbase and other crypto companies, alleging that the digital assets they allowed customers to buy and sell were unregistered securities. In May, the industry scored a rare legislative victory when Congress voted to overturn an SEC accounting directive that crypto companies had challenged. Mr. Biden vetoed the resolution.
Now, the industry is fighting back. Fairshake announced plans to run in four other Senate races this year, including close races in Ohio and Montana, where Democrats who have been critical of crypto are running for re-election. Privately, crypto executives credit Fairshake with mollifying some skeptical lawmakers, including Sen. Sherrod Brown, D-Ohio, according to two people familiar with the talks. Mr. Brown, who is chairman of the Senate Banking Committee, said in April that he was open to advancing an industry-backed bill.
A few weeks after the California Senate primary in March, Representative Adam Schiff, the Democrat who defeated Ms. Porter, visited Coinbase’s offices in Mountain View, California. He met with representatives from Coinbase, Andreessen Horowitz and crypto-focused investment firms Electric Capital, Paradigm and Haun Ventures, two people familiar with the meeting said.
Mr. Trump has not always been a supporter of cryptocurrencies. He said he preferred dollars to Bitcoin, and in 2019, he tweeted that digital currencies are “based on air.” But recently, some crypto executives — in the market for a political savior — have embraced him.
Vivek Ramaswamy, a cryptocurrency enthusiast and former presidential candidate, has taken credit for Mr. Trump’s pivot to cryptocurrencies and created a role as his emissary to the industry: On Wednesday afternoon, Mr. Ramaswamy met privately with Brian Armstrong, CEO of Coinbase. at the Capitol Hill Club in Washington and encouraged him to support Trump’s campaign, a person familiar with the meeting said.
Mr. Armstrong has not publicly endorsed a presidential candidate. “We will not give special treatment to a particular party,” he said in a statement. “Crypto is a truly bipartisan issue.”
Mr. Selkis, who identifies as a libertarian, attended the Mar-a-Lago event in May after getting a ticket from a colleague who couldn’t make it. “I’m in the middle of eating my salad and the president catches me cold on stage,” Mr. Selkis recalled in an interview.
That evening, Mr. Trump declared: “If you’re pro-crypto, you’d better vote for Trump.” He has also announced that his campaign would accept donations in digital currency and pledged to commute the life sentence of Ross Ulbricht, a cult hero in the cryptocurrency world who ran the online drug market Silk Road.
On Tuesday afternoon, Mr. Trump met with about 15 Bitcoin mining executives for more than an hour at Mar-a-Lago, according to one of the attendees, Salman Khan, Marathon Digital’s chief financial officer.
At one point, Mr. Khan said, executives showed Mr. Trump the inside of a machine used to mine Bitcoin, an energy-guzzling process that has raised environmental concerns. “He liked the made-in-America feature,” Mr. Khan said.
Not everyone in the crypto world is with Mr. Trump. At a conference in May, Marvin Ammori, a Democrat who works for crypto firm Uniswap, grilled Mr. Selkis on stage about the industry’s political strategy, warning that Mr. Trump might not follow through on his campaign promises. campaign.
But this month, Mr. Trump attended a fundraiser at the home of David Sachs, a prominent San Francisco venture capitalist, and reiterated his support for crypto, according to three people who attended. Among the guests were Mr. Selkis, crypto executives Tyler and Cameron Winklevoss and Paul Grewal, Coinbase’s chief legal officer, the people said.
“The cryptocurrency vote has already been won by President Trump,” Mr. Selkis said. “It is done.”
Shane Goldmacher contributed to the report.
