U.S. cryptocurrency companies showed strong support for President Donald Trump’s reelection campaign in 2024, contributing a total of over $144 million, according to a report published by the Center for Political Accountability (CPA). However, this “unchecked political spending” has raised concerns among regulators and has negatively impacted investor confidence and public trust in these companies.
The report highlights that crypto firms, particularly Coinbase and Ripple, made significant political donations during Trump’s campaign. Coinbase’s political action committee (PAC) donated over $79 million, while Ripple contributed more than $63.6 million. Additionally, Coinbase donated $1 million to Trump’s inauguration committee, and Ripple donated $5 million in digital assets. Coinbase has also committed to donating $25 million for the 2026 mid-term elections.
It’s worth noting that these exchanges have faced regulatory challenges in the past. Coinbase was charged by the U.S. Securities and Exchange Commission (SEC) for operating as an unregistered securities exchange, and Ripple has been involved in a legal battle with the SEC since 2020. However, Ripple recently secured a partial victory in court, with the judge ruling that XRP should not be classified as securities. Despite these challenges, the SEC dropped its investigation into Gemini, the crypto exchange founded by Tyler and Cameron Winklevoss.
The CPA report emphasizes the risks associated with unchecked political spending by crypto companies. It states that using political contributions to gain political influence can lead to reputational, legal, and financial risks, not only for the companies involved but for the entire industry. Industries that prioritize short-term political gains over transparency and compliance often face regulatory crackdowns and a decline in consumer trust.
The report also raises ethical concerns about conflicts of interest within the Trump administration. David Sacks, Trump’s pick for ‘crypto czar,’ divested his personal crypto holdings but remains a partner at Craft Ventures, an investment firm with stakes in crypto firms. This raises questions about the potential for personal gains from the creation of the U.S. Bitcoin stockpile.
Furthermore, the report highlights the dangers of political leaders promoting meme coins and fraud tokens. For example, Argentinian President Javier Milei promoted a token called $LIBRA, which quickly lost billions of dollars in value. Similarly, Trump promoted his own memecoin, $TRUMP, which experienced a significant decline in value.
In conclusion, the CPA report underscores the need for greater transparency and accountability in the cryptocurrency industry. Without these measures, the legitimacy of crypto in the financial world remains uncertain.
