Crypto Industry Increases Lobbying Efforts Amid Regulatory Challenges

Crypto Industry's Lobbying Surge

The cryptocurrency industry has significantly increased its lobbying efforts in Washington, seeking to influence legislation and improve its reputation after a tumultuous year. In the first three quarters of 2023, crypto firms spent $18.96 million on lobbying, surpassing the $16.1 million spent in the same period in 2022. This increase comes despite last year's collapse of FTX, which was a major spender in the lobbying arena.

Key Players in Crypto Lobbying

Leading the charge in lobbying expenditures is Coinbase, the largest U.S. crypto exchange, followed by other prominent entities like Foris DAX, the Blockchain Association, and Binance Holdings. These companies are strategically engaging with policymakers to build relationships and establish a sensible regulatory framework for the industry.

Addressing Reputation and Regulatory Challenges

The drive to expand in Washington is partly to repair reputations damaged by scandals, including the high-profile collapse of FTX and its former CEO's legal issues. Additionally, crypto companies are facing increased scrutiny from the U.S. Securities and Exchange Commission (SEC), which has accused firms of not adhering to its regulations. In response, lobbying intensified after the SEC filed lawsuits against Coinbase and Binance for alleged non-compliance.

Legislative and Market Aspirations

The industry is also advocating for the approval of a spot bitcoin exchange-traded fund (ETF), which could significantly broaden the cryptocurrency market. Optimism around this possibility has contributed to bitcoin reaching a 20-month high. Furthermore, crypto firms are pushing for legislative clarity, evidenced by a recent victory when a congressional committee passed bills aiming to define applicable financial regulations. Despite these advancements, the path forward remains challenging, with continuous lobbying efforts planned to further these legislative goals.