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SBF has been a ‘significant donor’ in the US midterm elections

The FTX founder has reportedly spent almost $40 million mainly supporting Democrats during the current political cycle, according to Open Secrets.

Crypto billionaire and FTX founder Sam Bankman-Fried have admitted to being a "significant donor" to both sides of the political spectrum ahead of the 2022 midterm elections.

Days ahead of the U.S. midterm elections on Nov. 8, SBF told his Twitter followers that he has given contributions to electoral campaigns on both sides of the fence.

The crypto billionaire said that he has been “supporting constructive candidates across the aisle to prevent pandemics and bring a bipartisan climate to DC,” as well as “working with them to support permissionless finance.”

SBF added that working with FTX Digital Markets co-CEO Ryan Salame, he has signed up campaigns to accept crypto “and gave some, including millions to Senate and House Republicans.”

Earlier this year, Cointelegraph reported that SBF was planning to spend up to a billion dollars to help influence 2024 presidential election campaigns. His real plan is to bankroll the candidate running against former president Donald Trump. In 2020, SBF donated $5.2 million to the Joe Biden presidential campaign.

According to Open Secrets, a platform following the money in politics, SBF is the sixth largest political contributor. The platform reports that he has made a total contribution of $39.8 million for the 2021-2022 cycle.

Of that total, 92% has gone to the Democrats with the remainder going to Republican candidates and campaigns. FTX co-CEO Salame favors the red side of the political divide, donating $23.6 million to Republican campaigns for the current cycle.

The top political contributor was billionaire investor George Soros who has pledged $128.5 million to the democrats. Billionaire venture capitalist Peter Thiel, who has backed several crypto startups, was ninth on the list with $32.6 million for the Republicans.

Related: US Election update: Where do the pro-crypto candidates stand ahead of the election?

Bankman-Fried also backs the political action committee (PAC) Protect Our Future, which was set up in January 2022 and has spent more than $9 million to support Democrat candidates.

Crypto has become a point of contention in the midterms with a larger tech and crypto-savvy voter base now having a say. According to a recent survey by fund manager Grayscale, 38% of respondents will be “considering crypto policy positions” when choosing their candidates.

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Crypto advocate mounts challenge to longtime Silicon Valley Congresswoman

Greg Tanaka is an entrepreneur and DeFi developer who wants to make crypto a legal tender.

In terms of policy, Greg Tanaka calls himself a legislator for the digital age and possibly the most pro-crypto person running in this election cycle. Now a Palo Alto City Council member, he has set his sights on the United States House of Representatives seat for California’s 16th: the Silicon Valley district. In an interview with Cointelegraph, the self-described nerd exuded enthusiasm and spoke with an unwavering smile about crypto and the financial system.

Legal DAOs and crypto tax holidays

“It’s the first form of truly better money,” Tanaka said of crypto. “More benefit goes to the people creating the value versus with traditional finance.” He envisioned a future where everyone would have their own token. That “will create a lot more economic equity,” he said.

In addition to his political career, Tanaka is the Mozaic Finance decentralized finance (DeFi) protocol developer, which is set to run on Avalanche after testing. Mozaic Finance describes itself as specializing in “automatic yield aggregation and fund management.” Tanaka is also the founder and CEO of Percolata, a machine learning-based retail staffing optimization service that has received funding from Google Ventures and Andreessen Horowitz (a16z).

Tanaka characterized crypto as “an early technology that needs a chance.” He said he is in favor of making crypto legal tender and giving decentralized autonomous organizations (DAOs) — “a better version of the corporation” — the same rights as C Corps or LLCs. As a runup to that, Tanaka proposed a crypto tax holiday, seeing a clear precedent for this type of aid for new technology. “E-commerce had no sales tax for decades,” he observed. “Legislators couldn’t figure out how to tax online sales, and that helped ecommerce become what it is today.” He also favors a moratorium on the capital gains tax on cryptocurrencies.

From municipal service to a Congress bid

Tanaka has been on the Palo Alto City Council since 2017. On the council, he has been “frequently […] the lone vote against excessive staff raises,” according to his website. He rose from president of a neighborhood association in 2006 to city planning and transportation commission chair before being elected to the city council.

Tanaka said he was inspired to run for Congress by the unreasonable crypto reporting requirements written into the original version of the bipartisan Infrastructure bill. “So many of our elected leaders don’t support or understand technology,” he said. “They throw rocks in the road in front of it.” Now is “a great time to be in crypto,” he added, noting:

“We were given a big gift when China banned crypto mining and trading — it was a big mistake for them.”

Tanaka was unimpressed with President Joe Biden’s Executive Order on Ensuring Responsible Development of Digital Assets. “It’s not negative,” he said, “but it’s not necessarily positive.”

“I think regulation should be more centralized,” he said. “It’s spread across agencies and it’s conflicting. There should be a crypto czar.”

Tanaka said he is an advocate of “separation of money and state,” taking pains to point out the allusion to the country’s founding fathers’ separation of church and state. Before crypto, the state had to control the money supply to create the currency and prevent counterfeiting. With crypto, however, all of that is done automatically in software.

Far from a single-issue candidate, Tanaka takes positions on a wide range of issues, some of which, such as improving the voting method, might be considered somewhat esoteric. Others, such as research and development amortization and foreign-derived intangible income, are comparatively technical. He opposes excessive regulation of major internet and tech companies.

Other issues Tanaka is passionate about are education because the future of the country depends on tech and nuclear energy, which he sees as a carbon-free and safe alternative to fossil fuels.

When asked about the energy consumption of crypto, he said the energy use associated with crypto has to be weighed against that of fiat currency to have a fair comparison, factoring in the energy used by fiat systems to print, mint and secure the fiat money supply with police, bank vaults, armored trucks to move money around, secret service for anti-counterfeiting and more. In that light, the energy usage of crypto software is “modest,” he said.

The District’s landscape

Tanaka, a democrat, is not the only candidate in the district race to take a pro-crypto stance on his platform, but he is clearly the most ardent. He has been endorsed by Forward Party and Lobby3DAO founder Andrew Yang, Litecoin creator Charlie Lee and Bitcoin Foundation board member Bobby Lee, among others.

Tanaka is one of seven candidates facing off against incumbent Democrat Anna Eshoo in a nonpartisan primary election. Eshoo has held her seat since 1993 and is a member of the House Committee on Energy and Commerce and the Congressional Artificial Intelligence Caucus, among many other caucuses.

Eshoo is well funded. According to campaign contributions tracking website Open Secrets, Eshoo’s campaign had raised $1,303,776, of which 33.35% was political action committee (PAC) contributions, as of March 31. Ballotpedia lists health, finance, insurance and real estate, and communications and electronics as the top industries contributing to her campaign in 2018.

Open Secrets shows that the Tanaka campaign has raising $95,352 by the end of March with no PAC money. He placed fourth among the eight candidates by that indicator. He has created the TanakaDAO for the sake of the transparency of contributions and to increase participation through nonfungible tokens (NFTs). He accepts contributions in seven cryptocurrencies. He seemed to take the financing gap quite in stride. “We have people,” he said. “Our campaign’s all volunteers. I think that is a more authentic way to win the race.”

Eshoo did not respond to a query from Cointelegraph sent through her website.

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