Lobbying is often labelled as bribery by many people who do not understand the system, but it’s a vital part of participatory democracy.
Lobbying is protected by the Constitution of the United States of America and happens secretively in every country.
As a part of lobbying the government, individuals and organizations run public campaigns to make the elected officials pick up and pass specific public policy actions in favour of their agendas.
The same is done by crypto companies too, and in the year 2022 alone, these crypto companies alone made lobbying contributions of up to $25.57 Billion with the sole motivation of influencing policies in their favour.
It only makes sense that companies that stand to profit from crypto lobbying will spend a considerable amount of money to ensure that crypto-friendly laws are passed as soon as possible.
For this reason, the expenditure on crypto lobbying has grown manifold over the last half a decade or so.
Key Insights & Stats
In 2022, Coinbase spent $3.30 million, making it the highest spender in crypto lobbying expenditure, followed by Blockchain Association with $1.9M spent and Robinhood with a spending of $1.84 million.
Coinbase spending increased by 4137% in the last 6 years, from $80,000 (2017) to $3.39 million (2022) and increased by 122% from $1.52 million (2021) to $3.30 million (2022).
Binance.us crypto lobbying expenditure increased by 500% from $160,000 (2021) to $960,000 (2022).
FTX.us witnessed a growth of 1340% in lobbying expenditure from $50,000 (2021) to $720,000 (2022).
Ripple saw a 2060% increase in lobbying expenditure from $50,000 (2017) to $1.08 million (2022).
Close to half of the total lobbying spending by crypto companies came in the year 2022 itself (The last 6 years’ total of $50.75 million of which $25.57 million was spent in 2022).
As per our research, in the year 2022, the top three companies that have lobbied the government to enact more pro-crypto laws are listed below:
Note: The expenditure listed below is for the companies that are involved with crypto, not the lobbying spend on crypto or about crypto specifically.
#1. Coinbase
- Total Lobbying Expenditures (2022)– $3.39 Million
- Number of Lobbyists Hired- 32
- Number of Revolvers- 26
Coinbase has spent $3.39 million in lobbying, which is the highest among the crypto companies in the USA.
They have the second-highest spot trading volume (~$1.16 billion) after Binance, which speaks in itself for why they would be interested in spending so much for lobbying exercises.
They have used a total of 32 lobbyists during the year, out of which 26 have been revolvers.
It is common practice amongst people working in the public sector, including congressional staff take jobs with lobbying companies as they understand the inner workings of the sectors they used to oversee.
These people are called “revolvers”, and the ones that make the opposite switch (from lobbying companies to public office) are called “reverse revolvers”.
#2. Blockchain Association
- Total Lobbying Expenditures (2022)– $1.9 Million
- Number of Lobbyists Hired- 18
- Number of Revolvers- 12
The Blockchain Association is comprised of like-minded individuals and claims to advocate for the advancement of crypto in the USA, by promoting blockchain technology and shaping national policy to ensure its success.
Its Board of Directors has representation from big crypto projects like Uniswap, Ledger, Kraken, and Filecoin, to name a few.
The Blockchain Association has used $1.9 million on lobbying for their interests and those of the crypto community as well.
This number is much smaller compared to Coinbase’s spending.
For this purpose, they have made use of 18 lobbyists, out of which 12 have been revolvers.
#3. Robinhood
- Total Lobbying Expenditures (2022)– $1.84 Million
- Number of Lobbyists Hired- 20
- Number of Revolvers- 12
Robinhood is primarily a service where users can trade traditional financial instruments, but soon after offering crypto trading, they were caught in the middle of the Dogecoin retail craze in 2021.
That year, the cryptocurrency drove 17% of Robinhood’s transaction-based revenue in the first financial quarter of the year, out of which 34% was attributed to Dogecoin.
Robinhood has spent close to $1.84 million on lobbying the US government for favourable regulations in the year 2022.
As part of this campaign, they have enlisted the help of 20 different lobbyists, out of whom 12 were revolvers.
These individuals and companies aided them in getting specific policies either passed through the houses or brought to the forefront of the public conscience so that there is organic support for them as well.
Lobbying Expenditure Trend Since 2017
Going back to 2017, we have plotted a graph to showcase how lobbying expenditure has increased.
This shows which of the companies have been long-time proponents of the lobbying campaigns and have spent the most on lobbying as a whole.
Spending on crypto lobbying has taken off in the past 6 years and has shown a growth of 922% from $2.5 million in 2017 to $25.57 million in 2022.
The growth of the sector has been more than 121.41%, from $11.54 million (2021) to $25.57 million (2022).
Biggest Lobbying Spenders Since 2017
When it comes to the individual companies, the top five companies that have contributed most to this spending over the past 6 years are:
- CME Group
- Coinbase
- Block Inc (Square Inc)
- Blockchain Association
- Robinhood Markets#1. CME Group
- Total Lobbying Expenditures in 2022– $1.43 Million
- Number of Lobbyists Hired- 20
- Number of Revolvers- 13
The CME Group is a major proponent of Bitcoin and Ethereum derivatives contracts that allow traditional financial investors to get a taste of and profit off of crypto price volatility without ever taking ownership of the asset.
Ever since 2017, when the first derivatives contracts for Bitcoin were offered on the exchange, it has driven a lot of volume for the crypto derivatives market.
The company has spent close to $8.26 million in lobbying-related activities since 2017, which puts it firmly at the top of this list.
They have made use of 20 lobbyists in the year 2022, with 13 of them being revolvers.
#2. Coinbase
- Total Lobbying Expenditures in 2022– $3.39 Million
- Number of Lobbyists Hired- 32
- Number of Revolvers- 26
Coinbase is one of the oldest standing crypto exchanges to buy and sell cryptocurrencies. Being established in 2012 primarily for the US audience, it has now spread to 100+ countries.
By having so much skin in the game, the exchange has done a total spending of $5.595 million in the last 6 years, taking second place in this list and has recorded a steady growth of lobbying expenditure year-on-year.
#3. Block Inc (Square Inc)
- Total Lobbying Expenditures in 2022– $1.17 Million
- Number of Lobbyists Hired- 36
- Number of Revolvers- 25
Block, previously known as Square, has Cash App, TIDAL, TBD, and Spiral also under its umbrella of which Cash App, Spiral, and TBD are related to crypto and blockchain space, giving the parent company a strong incentive to spend significantly on lobbying to achieve their agendas.
This spending has bagged them the third position on this list, with an accumulated spend of $4.56 million in the last 6 years.
#4. Blockchain Association
- Total Lobbying Expenditures in 2022– $1.9 Million
- Number of Lobbyists Hired- 18
- Number of Revolvers- 12
Touting itself as the collective voice of the crypto industry, Blockchain Association has continued to play an important role in the crypto industry as it has a fair number of crypto builders on its Board of Directors and the rest of its team.
Its spending over the last 6 years has totalled $3.91 million, putting it at #4 on this list.
#5. Robinhood Markets
- Total Lobbying Expenditures in 2022– $1.84 Million
- Number of Lobbyists Hired- 20
- Number of Revolvers- 12
Having seen tremendous growth from the crypto sector after branching out from traditional trading instruments, Robinhood has only been part of the crypto lobbying exercise for the past three years.
Also, the speed of their investment has catapulted them to fifth position with a total spend of $3.895 million, beaten by a small margin by Blockchain Association’s contribution to the cause.
Conclusion
Lobbying has worked in favour of the cryptocurrency industry, with companies like Meta and IBM getting involved.
It has not been all smooth sailing, as just pouring money into the act of lobbying does not guarantee favourable outcomes.
Many companies and people who have skin in the crypto game continue to be sceptical of the changes that the cryptosphere will bring to the financial world and rebuff the advances by lobbying firms.
Methodology
To build these comparative analyses and graphics, The Money Mongers team have used data from OpenSecrets which ensures transparency for lobbying activities in the USA.
Using data from the website ensures that we were able to rank the companies that had a large involvement in the crypto lobbying space based on the total expenditure from 2017 onwards, which is a timeline of 6 years.
We also used this data to draw a comparison between which companies expended the most amount of money in just 2022.
