Why Crypto’s Election Spending Frenzy Signals a Push for Regulatory Overhaul – Coinbase Glb (NASDAQ:COIN)

The 2024 election cycle has been a showcase of the cryptocurrency industry’s aggressive new approach to political influence, and that investment now aims to reap rewards in the form of regulatory changes.

The industry’s massive spending wasn’t just aimed at supporting friendly candidates; it was a calculated attempt to reshape the regulatory landscape.

This means the sector is seeking to replace those it views as hostile regulators with policymakers more aligned with its growth ambitions.

This was particularly motivated by Coinbase COIN and venture capital company Andreessen Horowitz who were the largest backers of the pro-crypto super PAC Fairshake, which spent $173 million in the last election.

The “why” behind such considerable spending could not be clearer: to oust regulators considered “overzealous”, such as Sherrod Brown (D-Ohio), which the PAC alone spent $40 million against, and shift the focus from risk mitigation to industry development.

Coinbase’s recent call for president-elect Donald Trump and the new Republican Congress that established the Commodity Futures Trading Commission (CFTC) as the primary crypto regulator signals a major push for change.

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Emilie ChoiCoinbase’s president and COO made it clear that the company is seeking ground rules for the industry and an end to what it perceives as a “regulation by enforcement” approach, Politico reported Tuesday.

The “so what” is that Coinbase and the industry are looking for a future where the rules are clear, the regulations are predictable, and hope to have a more supportive environment in the new administration.

While the Biden administration has been critical, particularly following the FTX scandal, Trump’s opinions have evolved.

He had previously rejected crypto, but has now embraced the industry and integrated his new administration with crypto enthusiasts, like Paul Atkinswho will chair the SEC, and David Sacks which will advise on both AI and crypto, signaling a likely paradigm shift in the regulatory environment.

Coinbase’s actions demonstrate a clear understanding that politics is not a passive process, but requires active engagement.

As Choi herself put it, the industry realized that success “wasn’t going to happen naturally,” prompting them to “step up” and “make sure it actually happened.”

That’s why they recently invested another $25 million in Fairshake.

This aggressive approach is a signal to the political establishment that the crypto industry intends to become a long-term player on the political stage and a major force to be reckoned with.

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