Lynn Johannson, Advisor, Sustainability and ESG
January 4th, 2024
Lynn Johannson, President of E2 Management Corporation and Catalyst for THE Collaboration
In a care[...]
Crypto lobbying is going off the charts
The Economist | Dec 7, 2021
BETWEEN 2017 and mid-2021 the Commodities Futures Trading Commission (CFTC) was one of the American government agencies that discussed crypto the most. Brian Quintenz, who ran its Technology Committee, was responsible for much of that, organising presentations on everything from the integrity of bitcoin spot markets to the subject of decentralised finance.
“I developed a reputation as being...an advocate of innovation,” he says.
See: Cryptocurrency executives called to testify in Congress Dec 8
In September Mr Quintenz joined Andreessen Horowitz, a venture-capital firm and an investor in crypto startups, as an adviser. He is only one of many former American officials to have flocked to the cryptoverse. Others include Jay Clayton, the previous head of the Securities and Exchange Commission (SEC); Brian Brooks, who until January was the acting Comptroller of the Currency; and Chris Giancarlo, head of the CFTC between 2017 and 2019. In Britain, Philip Hammond, a former Chancellor of the Exchequer, joined Copper, a crypto startup, in October.
One prong of it has been to lure government officials and compliance experts from banks with big pay packets. Deepali Vyas of Korn Ferry, a headhunting firm, says senior risk managers are typically promised a salary of $600,000-2m; former high-ranking regulators are also locked in with share bonuses worth tens of millions of dollars, which vest over years. The former head of an American regulator, now at a crypto group, says he spends a lot of time meeting lawmakers and civil servants.
See: Over 400 SEC new enforcements in 2021 including Crypto, Dark Web, DeFi targets
The industry is also hiring lobbyists. Based on public disclosures The Economist calculates that crypto firms spent around $5m lobbying the American Senate in the first nine months of 2021. About $2.5m of that was spent between July and September—a quadrupling over the same period last year. Such activities employ the equivalent of 86 full-time staff, up from just one in 2016. Coinbase, a big crypto exchange, doled out $625,000 on lobbyists in the third quarter alone. Block, a crypto-friendly payments firm, has spent more than $1.7m since April 2020. The campaign is also ramping up in Brussels, the EU’s de facto capital, where the industry has deployed the equivalent of 52 full-time lobbyists.
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