Cash News
Two political action committees with ties to the cryptocurrency industry are coming off the sidelines to help Sen. Ted Cruz, R-Texas, as he faces an unexpectedly tight reelection fight with Democratic U.S. Rep. Colin Allred.
Allred is not known as a crypto skeptic; he voted for the industry’s top-priority bill this year. That has not stopped the two PACs from doling out hundreds of thousands of dollars in recent days to aid Cruz, who has said he wants Texas to be “the oasis on planet Earth for bitcoin and crypto.”
The sums don’t compare to the firehouse of cash, heavily favoring Republicans, that a separate industry group — Fairshake — has unleashed in other races. Still, the spending suggests that industry factions trust only Republicans to reduce regulation.
“The only way to protect Bitcoin is to beat Democrats in the House and Senate so we can block White House regulation.”
“We believe the only way to protect Bitcoin is to beat Democrats in the House and Senate this November so we can block White House regulations,” Bitcoin Freedom PAC, one of the groups that gave to Cruz this week, says on its website. “Democrats in Congress are a rubber stamp for Biden, and he’s made it clear that Bitcoin is in his sights if we don’t fight back.”
Bitcoin Freedom PAC, which is affiliated with the business influence group Club for Growth, made the biggest cash infusion to Cruz’s race. The PAC gave $350,000 to a pro-Cruz PAC on October 9, according to a Wednesday filing with the Federal Election Commission.
The same day, Bitcoin Freedom PAC received $215,000 from another group called the Crypto Freedom PAC, which in 2022 received $4.9 million from Republican megadonor Jeff Yass, whose investment firm owns $1 billion worth of bitcoin exchange-traded funds.
Bitcoin Freedom sent its money to the pro-Cruz Truth and Courage PAC, but another group made a much smaller expenditure on its own. The Bitcoin Voter PAC spent $5,000 on pro-Cruz text messages last week, according to FEC filings. The PAC is also running Facebook ads with the video of Cruz proclaiming that Texas should be a crypto “oasis.”
The Bitcoin Voter PAC is receiving support from a $2 million campaign organized by three Bitcoin mining companies, according to a Wednesday report from Fox Business. The group is also supporting Donald Trump and Republican Pennsylvania Senate candidate Dave McCormick.
Alarm Bells for GOP
The money spent on Cruz came as Republicans rang alarm bells about his tightening race with Allred, a centrist Democrat who is fighting an uphill battle against decades of GOP dominance in Texas.
Cruz is running well behind Trump in the state with a narrow 48 to 47 percent polling lead over Allred, according to an Emerson College survey released Wednesday.
Cruz has spoken at industry gatherings, downplayed bitcoin mining’s threat to the Texas electrical grid, and last year bought up to $100,000 worth of Bitcoin himself.
Scores of Democrats voted for the bill loosening oversight of the crypto industry in the House of Representatives, and another major PAC has backed some Democrats in their races for the House and Senate.
Allred doesn’t have a reputation as a crypto scold in Congress. In July, he voted for an industry-supported bill that would transfer oversight of the industry from the Securities and Exchange Commission, which has aggressively pursued enforcement actions against crypto companies, to the under-resourced Commodity Futures Trading Commission, which is known for having a lighter regulatory touch.
A crypto pressure group rated Allred as “somewhat supporting” crypto. That didn’t cut it for the most ardent crypto backers.
“Digital assets should play a major role in the future of the American economy,” Club for Growth President David McIntosh said in a statement to The Intercept, “and Texas voters deserve a long-time leader like Sen. Cruz who has consistently supported their implementation as opposed to someone … ‘somewhat’ supportive.”