The United States has seen a rise in cryptocurrency advocacy, with the amount of lobbying money for the industry increasing in recent years.
According to Cryptohead.io, the total amount of lobbying in crypto-related areas in the United States was $4.9 million in 2021. This is more than double the $2.3 million spent in the previous year. This study was based on data from Open Secrets, a government transparency group that collects lobbying tracking data.
Cryptohead’s research shows that the sum of lobbying expenses over the last five years was more than $9.5million. In 2017, the total amount spent on crypto lobbying was as low as $200,000.
Since 2017, crypto lobbying has been spending. Source: Cryptohead.io
Cryptohead estimates that the U.S. crypto sector’s lobbying expenditure is approximately $5 million. However, analysts believe the industry spends a lot more on political initiatives. Americans for Financial Reform reported that Wall Street executives, employees, and trade associations spent nearly $3 billion on political initiatives in the 2020 election cycle.
The report states that Ripple Labs (the developer of Ripple’s open-source protocol, remittance and payment system Ripple), is the largest-spending crypto company in America over the past five year, with lobbying costs totaling almost $2 million.
The study states that Ripple Labs may be the most influential cryptocurrency company in America when it comes to influencing government policy and regulation. The U.S. Securities and Exchange Commission has filed a lawsuit against Ripple Labs since late 2020. Regulators claim that Ripple Labs was involved in a $1.3 million unregistered securities sale of XRP.
The industry’s lobbyists also include Robinhood, a crypto-friendly stock trading app, and the Blockchain Association, Coinbase, and Block.one, industry advocates. The data shows that Coinbase was the largest-spending lobbying Blockchain company in 2021 with expenditures totaling over $1.3million.
Since 2017, the biggest-spending lobbyists in blockchain have been Cryptohead. Source: Cryptohead
According to some reports, the increased lobbying spending by the crypto industry is a result of the market drawing more attention from U.S regulators.
The SEC threatened to sue Coinbase in September 2021 over the Lend crypto yield program. This regulator considered it a security. The Lend product was ultimately cancelled by the firm. The U.S. Financial Industry Regulatory Authority had previously ordered Robinhood to pay $70 million in penalties for “widespread, significant harm” to its users as well as “systemic supervisory failings” that began as early as September 2016.