Many members of Congress with the biggest influence over coming U.S. cryptocurrency legislation received direct contributions from top executives of FTX, leaving them in a complicated political relationship with the crypto industry.
More than one in three of the lawmakers on the Senate Banking Committee, House Financial Services Committee and the Senate and House agriculture panels took campaign money from former CEO Sam Bankman-Fried and other senior executives of the disgraced crypto exchange. Those on the agriculture committees – which have oversight of derivative trading – were particular funding targets of FTX management.
As the House Agriculture Committee begins considering how the Commodity Futures Trading Commission (CFTC) should oversee digital assets, two of its most important members are contending with receiving FTX money. The campaign of Chairman Glenn Thompson (R-Pa.) took donations from Bankman-Fried and Ryan Salame, who was co-CEO of FTX Digital Markets. The new chairman of the subcommittee focusing on crypto, Rep. Dusty Johnson (R-S.D.), accepted a contribution from Salame.
“The FTX debacle proves we must have more robust regulation over the crypto industry,” Johnson said in a statement. “No degree of political involvement by FTX executives can obscure that plain fact.”
The lawmakers who received FTX money in the four key committees – 38% of the members, according to Federal Election Commission records – have been under pressure to say something about what they'll do about the contributions now. One in 10 told CoinDesk they donated the money to charity.
However, that decision may have backfired because FTX’s bankruptcy team is working to claw back those donations, directly asking the candidates to return the funds or face legal action.
Nearly two-thirds of the members of the Senate Agriculture committee took FTX cash, including Sen. Debbie Stabenow (D-Mich.), the panel’s chairwoman, and its ranking Republican, Sen. John Boozeman (R-Ark.). Last year that panel was in the crypto industry’s spotlight because the two lawmakers pushed a bill to establish rules of the road for digital assets in the U.S., including giving the CFTC authority over trading of non-security tokens such as bitcoin.
They’re expected to give it another go in this congressional session, but the previous legislation – the Digital Commodities Consumer Protection Act – was championed by Bankman-Fried, so the specter of the fallen CEO could loom large.
Oversight of stablecoins is seen as a regulatory need that could be solved with a relatively narrow bill. The House Financial Services Committee’s top members worked on one in 2022, and new Chairman Patrick McHenry (R-N.C.) has indicated crypto remains a priority.
The Senate Banking Committee is also focused on digital assets, and has scheduled a Feb. 14 hearing examining the “crypto crash.”
Seven of the 23 members of the Senate Banking Committee accepted money from FTX executives, including Sen. Tim Scott (R-S.C.), the panel’s ranking Republican. If crypto legislation happens this year, there will likely have to be a meeting of the minds between Scott and the committee’s crypto-skeptic chairman, Sherrod Brown (D-Ohio).
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