The cryptocurrency company Ripple announced a $25 million donation to the Fairshake super PAC on Wednesday as part of an industry-wide effort to promote pro-crypto policies and politicians at a crucial time.
Last December, Ripple poured $20 million into Fairshake, which has already spent $11.3 million on federal elections. The wave of donations marks a significant escalation in Ripple's political involvement. According to the Federal Election Commission (FEC), Ripple donated just $500,000 during the 2022 election cycle facts.
“Ripple will not – and the crypto industry should not – remain silent while unelected regulators actively seek to hinder the innovation and economic growth enjoyed by millions of Americans,” said Ripple CEO Brad Garlinghouse.
Fairshake reported more than $52.2 million cash on hand as of April 30, a sizable war chest heading into the heat of the 2024 election.
More than $10 million of the super PAC's spending so far has gone toward opposing a Senate bid by Rep. Katie Porter (D-California). Porter, who lost her Democratic Senate primary in March, is “strong against crypto” said Stand With Crypto, a 501(c)4 nonprofit that helped another crypto giant Coinbase launch last summer.
Coinbase is another top donor to Fairshake together with venture capital firm Andreessen Horowitz, asset manager ARK Invest and crypto-focused investment firm Paradigm Operations. The crypto community has publicly dropped ties with the Securities and Exchange Commission (SEC) in recent years and sued Ripple and Coinbase for alleged violations of federal securities laws.
But the House of Representatives last week voted to pass the Financial Innovation and Technology for the 21st Century Act (FIT 21), a sweeping crypto regulation that would categorize most digital assets as a “commodity,” regulated by the Commodity Futures Trading Commission (CFTC). Only specific digital assets would be regulated by the SEC as a “security” under the bill, which has not yet passed the Senate.
SEC Chairman Gary Gensler opposite the bill, saying it would “create new regulatory gaps and undermine decades of precedent.”
“The crypto industry's reputation for failure, fraud and bankruptcies is not because we don't have rules or because the rules are unclear,” the SEC chairman said ahead of the House vote. “It's because many players in the crypto industry are not following the rules.”
Perhaps one of the biggest scandals to hit the industry was the downfall of disgraced crypto magnate Sam Bankman-Fried, who became the public face of crypto in politics ahead of the 2022 midterm elections. He donated publicly more than 40.7 million dollars to groups that primarily support Democratic candidates, making him the seventh-largest donor in that cycle, according to the research group OpenSecrets, although he has since admitted to funneling “dark” contributions to groups that support Republicans not in that total included.
The crypto industry quickly distanced itself from Bankman-Fried after his exchange platform FTX collapsed days after the midterm elections. He has since been sentenced to 25 years in prison for federal fraud and conspiracy charges related to his role in the collapse.
The broader crypto industry has also increased its political involvement, spending millions on lobbying for bills including FIT21, in addition to its political contributions. Garlinghouse said the “crypto industry plans to continue investing heavily in this effort until we see meaningful change.”
Ripple called the 2024 election “the most consequential in crypto history.”
“We must elect leaders who understand this potential and support policies that protect consumers and markets in ways that are fair and innovative,” Ripple said in a statement.
