The U.S. cryptocurrency industry has flexed its campaign-finance might to help dethrone veteran incumbents and elevate new allies in Texas and other states as the congressional midterm season approaches full velocity, though the arrival of new political action committees may put the sector's meticulous bipartisanship in question.

Market Context

Fairshake remains an unrivaled channel for millions of dollars to steer primary elections, but other crypto super PAC names have crept into the conversation, getting louder following this week's Texas primaries. The collective crypto spending is already contributing to real consequences for the next Congress. Prediction markets platform Kalshi puts Democrats at a 77% chance to win the House majority and 46% odds for a Senate majority.

Analysis

The most recent Texas runoff bouts illustrated the widening reach of the crypto industry in politics, with Fairshake targeting and helping oust longtime Democrat Al Green—a fixture on the House Financial Services Committee who was critical of the industry's consumer hazards. The Fellowship super PAC, associated with Tether and Cantor Fitzgerald, backed Texas Attorney General Ken Paxton's trouncing of an incumbent Republican with $500,000.

Fairshake spent $6.5 million to get U.S. Representative Christian Menefee advanced in place of Green. The Blockchain Leadership Fund, established recently with inaugural donations from Anchorage Digital and Chainlink, also endorsed and donated to Menefee, who won Tuesday's unusual runoff of two incumbents pitted against each other by redistricting.

The industry's core backers—Coinbase, Ripple, and a16z—have devoted significant resources to politics. Those who run Fairshake have routinely declined to answer questions about strategy, but the mega PAC has demonstrated its goal has nothing to do with traditional political ideology and everything to do with friendly crypto policy. It buys ads for favored candidates using whatever political messaging helps the particular Republican or Democrat get elected—almost never mentioning crypto.

However, newer PACs appear more ideologically aligned. The Digital Freedom Fund, set up by Tyler and Cameron Winklevoss of Gemini with $21 million, is designed to support Republican candidates and President Donald Trump's crypto agenda. The Fellowship PAC, established with about $11 million (far short of an originally pledged $100 million), has solely contributed Republican support in several races.

Key Numbers

- Fairshake spending power before election season: $193 million

- Fairshake spent to unseat Al Green: $6.5 million

- Fairshake spend against Juliana Stratton in Illinois: more than $10 million (lost)

- Fellowship PAC initial funding: approximately $11 million

- Digital Freedom Fund war chest: $21 million

- Fellowship contribution to Ken Paxton: $500,000

- Largest single Fellowship expenditure: $629,000 to Andy Barr in Kentucky

- Fairshake backing for Alex Mealer: $453,000

- Fairshake backing for Carlos De La Cruz: $607,000

- Sentinel Action Fund spending against Sherrod Brown: $8 million

- Total Fairshake spending across Kentucky, Alabama, Georgia primaries: $20 million

What to Watch

The shift in bipartisan strategy bears watching. While Fairshake maintains two affiliate PACs—Protect Progress for Democrats and Defend American Jobs for Republicans—the party's balance may be tilting this year based on recent Federal Election Commission filings showing heavier funding of the Republican affiliate.

The industry's Republican emphasis outside of Fairshake comes at a time the party is beset by midterm election math. The declining popularity of Trump in polls has dragged down the party's already tenuous chances to keep its House majority next year, raising questions about whether Republicans backed by crypto money will find themselves in the congressional minority and less able to direct policy.

Anchorage Digital's engagement with both Fairshake and Fellowship reflects a broader industry push for bipartisan outcomes. Kevin Wysocki, head of policy at the crypto bank, said its approach is meant to reflect "commitment to investing in bipartisan policy results." The Blockchain Leadership Fund has taken a more modest approach, focused on smaller direct contributions to candidates' campaigns rather than massive super PAC spending.