This story is excerpted from Capitolized, a weekly newsletter featuring expert reporting, analysis and insight from the reporters and editors of Montana Free Press. Want to see Capitolized in your inbox every Thursday? Sign up here.
It wasn’t long after the crypto crash of 2022 that U.S. Sen. Jon Tester summed up the digital currency lacking government oversight or treasury backing thusly:
“It’s not been able to pass the smell test for me. I have not been able to find anybody who’s been able to explain to me what’s there other than synthetics, which means nothing,” Tester said on Meet the Press Dec. 11, 2022. Cryptocurrency had started the year on a high, but was exiting 2022 at a fourth of its January value.
“And the problem is, is that if we regulate it, and I pointed this out to some of the regulators here a week or two ago, if we regulate it, it may give it the ability for people to think it’s real,” Tester said. “I’m not a regulator, and I’m not a financial person that does regulation, but I see no reason why this stuff should exist.”
Still desperate for the legitimacy that comes from being regulated, the crypto lobby is now byte-ing back at congressional doubters. As Bloomberg reported last week, the big players in crypto have raised $160 million to target vulnerable lawmakers. Tester, as one of the longest-serving Democrats on the Senate Banking Committee, is a potential target. Committee Chairman Sherrod Brown, an Ohio Democrat, is another.
Federal election records show that the crypto political action committee Fairshake spent $10 million opposing Democratic Rep. Katie Porter’s Senate bid in California.
Tester’s recent voting record on crypto has been favorable to the industry. In May, Tester joined Republicans, Montana Sen. Steve Daines included, to thwart a Securities and Exchange Commission advisory recommending that banks should record crypto assets held by customers as liabilities and emphasizing the need to disclose the boom-bust risk associated with crypto’s value.
As Bloomberg reports, crypto PACs do business in dollars, not cryptocurrency.
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