The US crypto company was given a large right to President Donald Trump’s reelection in 2024, donating more than $144 million to his campaign. However, according to a report released by the Centre for Political Accountability (CPA), a nonprofit that promotes transparency in corporate political contributions, “unidentified political spending” poses “deep risk.”
The report states that the crypto companies’ “active push for deregulation combined with opaque and inexplainable political contributions” “supports a red flag among regulators.” More importantly, it “encroached investors’ trust and public’s trust in the long-term viability of these companies.”
Crypto companies have made large donations to re-election Trump, and it’s paying off
Political spending by US crypto companies reached “unprecedented scale” during Trump’s reelection campaign, particularly Coinbase and Ripple, the report says.
Coinbase’s Political Action Committee (PAC) has donated more than $79 million for Trump’s reelection, according to data from OpenCrets, a platform that tracks political donations. Ripple was the second largest donor among crypto companies with over $63.6 million in contributions.
Coinbase also donated $1 million to Trump’s Inaugural Committee, while Ripple has donated $5 million in digital assets. Additionally, Coinbase has pledged to donate $25 million to the 2026 medium-term elections.
Crypto Exchange Gemini founders Tyler and Cameron Winklevoss have donated $1 million worth of Bitcoin (BTC) to Trump 47.
All three exchanges were in hot water with the US Securities and Exchange Commission (SEC). In June 2023, the SEC charged Coinbase to operate as an unregistered stock exchange.
Ripple has been caught up in a legal battle with the SEC since 2020. In August 2024, Ripple secured a partial victory in the court as the judge declared that XRP could not be classified as a securities because it failed to meet the Howey Test. However, the SEC appealed the decision. The decision is described as “madness” by CEO Brad Garlinghouse.
Similarly, in January 2023, the SEC indicted Gemini and Genesis for providing unregistered securities through a now-deprecated acquisition program. After a federal court rejected the company’s request to dismiss the SEC case, Genesis resolved the case by paying $21 million. But Gemini continued to fight.
Trump has pledged to fire SEC chairman Gary Gensler, but Gensler resigned at Trump’s inauguration. Since then, the tables have changed and things have begun to look for crypto companies.
Last month, Cameron Winklevoss announced that the SEC had stopped investigating the exchange. The company is reportedly currently secretly submitting its first public offering (IPO). Similarly, the SEC dismissed the lawsuit against Coinbase on February 27th.
Earlier this week, Trump signed an executive order creating a strategic Bitcoin reserve.
CPA report argues that unconfirmed political spending risks could put the industry at risk
The CPA report argues that crypto companies use their political contributions to gain political influence. This strategy poses reputation, legal and financial risks, and can put the future of the companies involved at risk, as well as the entire industry.
The report states:
“The risk of instability, regulatory repulsion and public mistrust will only grow as the (crypto) industry continues to seek influence through enormous contributions and opaque financial operations.”
The report also warned that historically, industries that prioritize short-term political interests over transparency and compliance often face significant consequences. This includes repression of regulations and lowering consumer trust.
The CPA report also pointed to conflicts of interest within the Trump administration, which raises serious ethical issues. For example, Crypto Investor David Sacks, a Trump choice for “Crypto Czar,” will benefit greatly from creating a US BTC reserve.
Earlier this week, Sachs confirmed that he had sold his personal crypto holdings before the start of the Trump administration. However, he remains a partner in his investment company Craft Ventures and holds a stake in Crypto Firms. Therefore, the investment company, and by that bag, could benefit from the US government embracing Bitcoin.
“This spectre of fraud does nothing to alleviate concerns about the nature of salary increases to cryptocurrency,” the report said.
The report also highlighted the dangers of political leaders promoting meme coins and fraud tokens. For example, Argentine President Javier Mairay promoted a token called $Libra, which lost around $4.6 billion within hours. Similarly, Trump promoted his own memocoin $Trump on January 17th. The token peaked at over $73 on January 19th, but has since lost more than 83% of its value.
The CPA report concluded:
“Without high transparency and accountability, the very future of crypto legitimacy in the financial world remains uncertain.”
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