Washington—The First Years of the Founding of the United States Coin libraryCEO Brian Armstrong has avoided Washington, D.C., but as his ambitions for the cryptocurrency exchange expand, he also needs to curry favor with Capitol Hill.
“About five or six years ago, we realized that cryptocurrencies had become big enough that we needed to be really active in policy, so I started coming to Washington,” Armstrong, who founded Coinbase in 2012, told CNBC in September after a day of meetings with political leaders.
Now, it’s effectively Armstrong’s full-time job, with Coinbase money all over the nation’s capital. The company is one of the largest corporate donors this election cycle, giving more than $75 million to a group called Fairshake and its affiliated PACs, including $25 million in new commitments Back a pro-crypto super PAC in the 2026 midterm elections. Armstrong has personally donated more than $1.3 million to candidates up and down the ballot.
Tech giants have been gathering in Washington for years to try to push their agenda as their market caps have grown, but for Coinbase, the matter could be a matter of survival.
SEC Chairman Gary Gensler sued the company last year Accused of selling unregistered securities. The judge then ruled The case shall be tried by a jury. Coinbase has pushed back hard and said it hopes to work with regulators to develop an appropriate set of laws to govern the nascent industry.
At the same time, Coinbase faces a growing number of competitors.
In the company’s latest quarterly earnings report last week, Coinbase missed revenue and profit due to lower trading revenue and lower subscription and services revenue. Stock price plummets 15%.
Data from CCData shows that the exchange is losing spot market share to industry competitors such as Crypto.com. Since the SEC approved spot funds this year, investors have many new options for acquiring Bitcoin and Ethereum. Head of BlackRock ETFs Samara Cohen told CNBC 75% of Bitcoin buyers are cryptocurrency investors new to Wall Street.
Washington can’t save Coinbase from competition, but the company is betting that with favorable lawmakers in place, it can become a leader in a booming industry rather than under the constant threat of lawsuits and Wells Notices.
Armstrong said he usually visits Washington once or twice a year. Then at least once a quarter. And the pace is only increasing.
“In the beginning, a lot of people didn’t know what cryptocurrency was,” Armstrong said of his early travels. Now, “the discussion has actually progressed to how do we pass clear rules, legislate in the United States?”
SEC without Chairman Gensler
Paul Grewal, Chief Legal Officer, Coinbase participated in June fundraiser in San Francisco Raised $12 million Former President Donald Trump. The meeting was moderated by venture capitalist David Sacks, a former critic of Trump who became an outspoken supporter after becoming the Republican nominee.
Grewal later joined Nashville fundraiser July for the former president.
Trump has never shown much flair for the nuances of cryptocurrencies, but he has welcomed financial support from the industry. In the summer, he received warm applause, Vows to fire Gensler If he wins, he will serve as SEC chairman.
Greval told CNBC He has had “numerous closed-door conversations” with the Trump campaign and Democratic Vice President Kamala Harris’ campaign. Election Day is approaching on Tuesday, and the candidates are almost in a stalemate.
“I think what we’re hearing from both campaigns is that they get it,” Grewal said. “They understand that in battleground state after swing state, there are enough voters who care about cryptocurrency, the candidates and the His campaign needs to express the concerns of these voters, support smart rules for cryptocurrency, and smart legislation enacted by Congress, and that’s very encouraging.
Grewal said Trump “made pro-crypto arguments earlier,” but Harris acknowledged the need for “an agenda dedicated to sensible rules that promote cryptocurrencies and other technologies.”
But Coinbase is not involved in the presidential race and has dedicated its financial focus to congressional races as the company looks to help assemble a cadre of lawmakers with a positive view of the industry.
this Stand with the Cryptocurrency Alliancelaunched by Coinbase last year, A scoring system was developed For House and Senate candidates nationwide.
For example, in the Ohio Senate race, the group gave Democratic incumbents Senator Sherrod BrownHe received an “F” as chairman of the Banking Committee, while his Republican opponent, blockchain entrepreneur Bernie Moreno, received an “A.” About $40 million in cryptocurrency has been used to defeat Brown, and a PAC has paid for five ads aimed at raising Moreno’s profile. The race is extremely close and will be crucial in determining which party will control the Senate.
Stand with Crypto has recruited 1.4 million advocates nationwide, and the organization is also working to mobilize digital asset owners living in swing states. The effort involves cross-country bus tours through various battlegrounds focused on getting these residents registered to vote.
“Given the razor-thin margins of victory in the 2020 election, it’s truly remarkable that cryptocurrency has become not just an issue, but potentially the defining issue of the presidential cycle.” Faryar Shirzad, Chief Policy Officer, Coinbase said in the interview.
Shirzad said that last year, he and his team concluded that the only way to take politics out of cryptocurrencies was to “build our own political operation.” The goal, he said, is to “neutralize the politicization of the cryptocurrency issue and discuss its substance.”
Coinbase is not alone. Nearly half of all corporate funds raised this election came from cryptocurrency companies.
Fairshake, one of the highest-spending PACs this round, told CNBC it raised about $170 million in this election and paid out about $135 million.
Ripple Labs is another top political donor to Fairshake.
The company has spent more than $100 million fighting Gensler and donated about $50 million to Fairshake. Several top executives have also contributed to campaigns for Democratic and Republican candidates across the country.
Lauren Belive, Ripple’s head of U.S. public policy, told CNBC at a fintech conference in Las Vegas that the company was motivated by an SEC overreach.
“We really want to put people in office who can understand this technology and understand this technology, because we need Congress to take action and create federal regulations, not create this enforcement system,” Bellive said, adding that regulation Agencies have taken more than 100 enforcement actions against cryptocurrency-related companies.
Crypto voters
Stand with Crypto’s bus tour culminated in a rally at the Black Cat in Washington on a Wednesday night in September.
This popular music venue has no windows, with purple walls mixed with exposed brick and black and white checkered floors, giving off an Alice in Wonderland vibe.
As the music blared and the drinks flowed, free “Stand with Crypto” merchandise was handed out to attendees. Remaining gift bags were generously distributed to those who wanted to take home extra items.
Armstrong slipped out of his black SUV and spoke to CNBC outside the venue. Wearing a suit and tie, he stood in stark contrast to the other attendees. Armstrong said he is confident about the upcoming election.
“Crypto voters are now a big part of this election,” Armstrong said. “I think crypto voters are definitely there and we’ll see what happens in November.”
In addition to Armstrong, Consensys CEO Joe Lubin and Rep. Willie Nickell (D-N.C.) spoke at the rally. Most of the remarks were inaudible over the roar of the crowd.
The crowd was silent as headline act The Chainsmokers took the stage. The band opened with their 2017 classic “Paris,” and the crowd chimed in on the chorus: “If we fall, we fall together.”
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