The recently collapsed FTX exchange spent $71 million on the US mid-term elections, per multiple reports. However, after FTX failed, Binance.US (the US subsidiary of the world’s largest crypto marketplace) took it upon itself to become more involved in politics.
It plans to launch its PAC (political action committee) on US soil soon. Hence, it has submitted a registration for the PAC.
Krishna Juvvadi, the company’s head of legal and a previous Uber regulatory attorney, will serve as the organization’s treasurer. Even though Binance didn’t release any official statement regarding this development, many industry players question the news’s timing.
They are concerned that Binance is establishing its PAC one month after the congressional election. Hence, it only has two years to prepare for the next general and presidential elections.
In a recent study, the leading investment firm JPMorgan stated that there had never been more pressure on lawmakers to regulate cryptos than now. The recent implosion of FTX has made cryptocurrency legislation a top priority for America’s legislature.
Due to the impending regulatory crackdown, cryptocurrency companies, including Binance.US, are increasing their spending on political campaigns and lobbying. So far this year, the crypto exchange has spent nearly $730K towards lobbying.
The amount represents a significant rise from the $160K it spent last year per data from on-chain analytics firm, OpenSecrets.
Binance Joins The List Of Crypto Firms That Owns A PAC
Earlier this year, the US-headquartered crypto exchange, Coinbase, launched its PAC. A spokeswoman for Coinbase’s PAC stated that the exchange would support “cryptocurrency-forward regulators” on a 50-50 basis.
The PAC is only one component of Coinbase’s political advocacy work. In 2021, the US marketplace increased its lobbying expenditures to $1.5 million, a massive increase from the previous high of $230,000.
However, Sam Bankman-Fried of FTX was the most prominent political donor. Before going bankrupt, the FTX founder contributed nearly $73 million to various political campaigns in the United States in the period leading to the recently concluded mid-term elections.
FTX also increased its lobbying expenditures from $50K to $640K in 2022. Before the midterm elections, SBF personally made donations of 40 million USD, primarily to Democratic politicians.
A senior Exec at FTX’s Digital Markets named Ryan Salame contributed 21.6 million USD to Republican candidates. On the other hand, Binance has yet to make public the amount of money it would contribute to the PAC.
These political contributions may impact the development of cryptocurrency legislation and the industry’s growth.
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