$263 million in crypto capital enters the game: U.S. midterm elections become a new high ground for policy competition
This time, the number of super political action committees is greater, some of which have clearer positions aligned with Republican candidates.Original authors: Annie Massa, Olga Kharif, David Pan, Bloomberg
Original compilation: Luffy, Foresight News
Following the success in the 2024 U.S. elections, the cryptocurrency industry is ramping up its investment for the 2026 midterm elections.
According to Federal Election Commission (FEC) filings and public statements, several super political action committees (SPACs) focused on cryptocurrency are raising approximately $263 million. According to OpenSecrets data, this amount is nearly double the maximum SPAC Fairshake's investment in 2024 and slightly higher than the total spending of the entire oil and gas industry in the last election cycle.
After the cryptocurrency industry's significant investment in 2024, the Republican Party gained control of both chambers of Congress, and lawmakers passed several bills supported by the cryptocurrency industry while appointing friendly regulators to key positions. This influence was again evident last week: President Donald Trump pardoned Binance co-founder Changpeng Zhao, who had previously admitted to violating U.S. anti-money laundering laws and was sentenced to four months in prison during the Biden administration.
The legislative victories and the Trump family's acceptance of cryptocurrency have prompted some newly formed SPACs to shift their previous strategies and more explicitly support the Republican Party, helping the party consolidate its control of Congress.
The cryptocurrency industry is also leveraging political donations to push a series of legislative and regulatory priorities, with a recent core focus on the cryptocurrency market structure bill. This bill would fundamentally reform the regulatory framework for digital assets and could grant greater authority to the Commodity Futures Trading Commission (CFTC), which is more favorable to the cryptocurrency industry.
Midterm election budgets of various SPACs
To push the bill through, about 12 top executives from the cryptocurrency industry traveled to Washington last week. Despite ongoing negotiations related to a government shutdown, they met for over an hour with a group of senior Republican senators and had longer meetings with Democratic senators, including Minority Leader Chuck Schumer.
"The industry's success in 2024 has built a roadmap that proves cryptocurrency has a voice and can influence elections, whether you are an industry CEO or an ordinary user," said Cody Carbone, CEO of the Washington lobbying group The Digital Chamber. "In the future, more participants will join, and the funding will be greater."
Cryptocurrency companies and executives are providing funding support to policymakers and Trump's initiatives in various ways. Some cryptocurrency companies have struck business deals with Trump's family's cryptocurrency ventures, while others have donated to the inauguration in January and the parade in June. Additionally, several companies are funding the new $300 million White House banquet hall. According to the White House, this includes the U.S. branches of Coinbase, Ripple, and stablecoin giant Tether.
President Donald Trump showcases the planned Arc de Triomphe model at a dinner with business executives, highlighting the new White House banquet hall construction project
In addition to the White House, SPACs are also a focus for congressional members, 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 that the organization spent over $133 million in 2024 to support cryptocurrency-friendly candidates, making it one of the highest spending organizations on a single issue in the last election cycle. Its supporters include major U.S. cryptocurrency companies like Coinbase and Ripple, as well as venture capital firm Andreessen Horowitz.
In 2024, Fairshake and its two affiliated groups are trying to make cryptocurrency-friendly policies a bipartisan issue. For example, the organization invested about $10 million each in Democrats Elissa Slotkin and Ruben Gallego to help them win Senate seats in Michigan and Arizona, respectively. These two senators are among the 18 Democratic senators who voted in favor of the GENIUS Act, which paves the way for broader integration of stablecoins favored by the cryptocurrency industry into the financial system.
However, even in 2024, most of Fairshake's funding during the election phase is still directed toward supporting Republicans, including spending $40 million to successfully defeat then-Senate Banking Committee Chairman and Ohio Democrat Sherrod Brown.
Senate candidate Elissa Slotkin speaks to supporters at an election night event in Detroit in November 2024
This time, there are more SPACs, some of which have more clearly aligned themselves with Republican candidates.
The cryptocurrency project World Liberty Financial, co-founded by the Trump family and presidential envoy Steve Witkoff's family, announced last month that it would support the Digital Freedom Fund SPAC. This PAC was established in August by Gemini co-founders Tyler Winklevoss and Cameron Winklevoss, who stated in a post on X that they would donate $21 million in Bitcoin to support advocates of President Trump's cryptocurrency agenda in the primaries and midterm elections. According to insiders, 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 signing ceremony of the GENIUS Act in the White House
Another newly formed group is First Principles Digital PAC, which describes itself as "a Republican-led organization focused on electing pro-crypto leaders." Led by Republican strategist Jason Tillman, it was established after the 2024 elections, and FEC filings show it had approximately $954,100 in cash reserves as of the end of June. The organization has already supported Mike Rogers, who will run for a Senate seat in Michigan in 2026.
Recently, Fellowship PAC announced its formation in September and pledged to donate $100 million. Its donors have not been disclosed, but preliminary documents indicate that the financial officer is an executive from financial firm Cantor Fitzgerald, which was previously led by Trump administration Commerce Secretary Howard Lutnick.
Representatives from Digital Freedom Fund, Fellowship, Fairshake, and First Principles Digital PAC declined to comment.
The biggest variable is Tether. This Salvadoran-based stablecoin company has close ties with Cantor Fitzgerald, and The New York Times reported that supporters of Fellowship PAC are expected to include Tether, which recently established a U.S. entity.
In August, Tether announced plans to launch domestic products and hired former Trump core cryptocurrency policy advisor Bo Hines to lead the effort.
Tether CEO Paolo Ardoino stated 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 foothold in the U.S. may qualify it for donations.
On October 2, Tether CEO Paolo Ardoino speaks at the Token2049 conference in Singapore
In the face of the cryptocurrency industry's funding offensive, Democrats are increasingly concerned.
Eric Bowers-Boff, who previously worked for Elizabeth Warren and Hillary Clinton's campaign teams, serves as the executive director of the newly formed group Open Frontier, which aims to align more progressive voices with the cryptocurrency industry.
"Many people in my camp are still trying to understand this industry," Bowers-Boff said. "Right now, there is no reliable spokesperson, and the trust in the cryptocurrency industry has been severely damaged."
When cryptocurrency executives met with lawmakers in Washington last week, party divisions were evident. Chainlink Labs co-founder Sergey Nazarov noted that Republicans, including Senate Banking Committee Chairman Tim Scott from South Carolina, clearly expressed alignment with industry priorities, while Democrats raised sharp questions about the use of cryptocurrency in money laundering and decentralized finance.
"I think Democrats have not really understood our industry yet; they are concerned about illegal financial issues," Nazarov said.
Others argue that the industry's massive funding and newly gained political influence are forcing at least some Democrats to reevaluate their positions. Even Sherrod Brown, who previously held a hardline stance, has softened his critical remarks.
"Cryptocurrency has become a part of the U.S. economy and is increasingly popular in Ohio and across the country," said Brown's campaign manager Patrick Eisenhower in a statement. As more people adopt digital assets, Brown hopes to ensure that "it can expand opportunities, improve the lives of Ohioans, and not expose them to risks."
In 2024, Senator Sherrod Brown campaigns in Ohio for the Senate
The demands of cryptocurrency industry executives extend beyond the Republican desire to pass the market structure bill before the midterm elections; they also include adjustments to cryptocurrency tax policies, anti-money laundering and sanctions-related rules, and the regulatory framework for decentralized exchanges.
Some donors are also looking at state and local elections, such as the New York City mayoral race. Cryptocurrency entrepreneur Brock Pierce donated over $1 million to a group supporting Eric Adams just days before Adams withdrew from the race.
In Nazarov's view, there is a common thread in meetings with politicians. "They realize the enormous economic value of this industry, so they must clarify how to respond," he said. "The industry will continue to grow, and they need to develop the right response."
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