Since the extravagant spending in 2024, lawmakers have passed industry-supported legislation and appointed friendly regulators to key positions.
Written by: Annie Massa, Olga Kharif, David Pan, Bloomberg
Translated by: Luffy, Foresight News
Following the success in the 2024 U.S. elections, the crypto industry is ramping up its investments 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 about $263 million. According to OpenSecrets data, this amount is nearly double what the largest SPAC, Fairshake, invested in 2024, slightly exceeding the total spending of the entire oil and gas industry in the last election cycle.
After the crypto industry's significant investment in 2024, the Republican Party took control of both chambers of Congress, and lawmakers passed multiple bills supported by the crypto 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 established SPACs to shift from their previous strategies to more explicitly support the Republican Party, helping the party consolidate its control over Congress.
The crypto 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 aims to fundamentally reform the regulatory framework for digital assets and may grant greater authority to the more crypto-friendly Commodity Futures Trading Commission (CFTC).
Midterm election budgets of various SPACs
To promote the passage of the bill, about 12 top executives from the crypto industry traveled to Washington last week. Despite ongoing negotiations related to the government shutdown, they held discussions 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 even greater."
Cryptocurrency companies and executives are providing funding support to policymakers and Trump's initiatives in various ways. Some cryptocurrency companies have reached business deals with Trump's family's crypto 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 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 in funds as of the end of June. OpenSecrets data shows that the organization invested over $133 million in 2024 to support crypto-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. crypto companies like Coinbase and Ripple, as well as venture capital firm Andreessen Horowitz.
In 2024, Fairshake and its two affiliated groups are attempting to frame crypto-friendly policies as 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 crypto industry into the financial system.
However, even in 2024, most of Fairshake's funding during the election phase is still directed towards supporting Republicans, including spending $40 million to successfully defeat the then-chairman of the Senate Banking Committee, Ohio Democrat Sherrod Brown.
In November 2024, Senate candidate Elissa Slotkin speaks to supporters at an election night event in Detroit
This time, there are more SPACs, some of which have more clearly aligned themselves with Republican candidates.
The crypto 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 the X platform that they would donate $21 million in Bitcoin to support advocates of President Trump's crypto 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 at the White House
Another newly established group is the 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 about $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, the Fellowship PAC announced its establishment 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 Salvador-based stablecoin company has close ties to 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 this year, Tether announced plans to launch domestic products and hired Bo Hines, a former key crypto policy advisor to Trump, 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 crypto industry's funding offensive, Democrats are increasingly concerned.
Eric Bowers, who previously worked for Elizabeth Warren and Hillary Clinton's campaigns, serves as the 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," Bowers said. "There is currently no reliable spokesperson, and the trust in the crypto industry has been severely damaged."
When crypto executives met with lawmakers in Washington last week, partisan divisions were evident. Chainlink Labs co-founder Sergey Nazarov, who attended the meeting, noted that Republicans, including Senate Banking Committee Chairman Tim Scott of 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 point out that the industry's massive funding and newly gained political influence are forcing at least some Democrats to reassess their positions. Even Sherrod Brown, who previously took a hard 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 living standards of Ohioans, and not expose them to risks."
In 2024, Senator Sherrod Brown at a Senate campaign event in Ohio
The demands of crypto 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. Crypto entrepreneur Brock Pierce donated over $1 million to support a group backing 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 formulate the right response."
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