Why Are Any Democrats Supporting a Bill That Was Championed by the Crypto Industry?

This article initially ran in Talking Points Memo. Read the original here.

In May, the crypto industry won big as the Senate Banking Committee advanced the Clarity Act. It passed largely along party lines, but two Democrats with crypto-friendly records, Ruben Gallego (D-AZ) and Angela Alsobrooks (D-MD), broke with their colleagues to support the bill. Last September, Alsobrooks and Gallego partnered with 10 other Senate Democrats to articulate their wishlist for the Clarity Act; their demands are more permissive than the hardline anti-crypto politics of Elizabeth Warren (D-MA) and the party’s progressive wing. However, they did pay lip service to consumer protection, strong regulatory agencies, and a provision to limit the Trump family’s crypto-powered corruption. 

Unfortunately, the Clarity Act will not achieve these goals. Instead, as Senator Warren observed, “Nothing made it into this bill that wasn’t approved by the crypto industry.”

The legislation would hand regulation of most digital assets to a Commodity Futures Trading Commission (CFTC) captured by private interests. The CFTC spent 2025 dropping cases against crypto companies at the behest of acting chair Caroline Pham. Then, in December, Pham left to become Chief Legal Officer of the crypto firm MoonPay. Now, the Commission’s board, which was designed to have a bipartisan membership of five, is currently chaired by one Trump loyalist who slashed a fifth of its already paltry staff. It’s this office which would have to manage a workload that one former CFTC lawyer has claimed would be equivalent to handling the behemoth Dodd-Frank financial regulatory law. Even the Securities and Exchange Commission, which is better equipped to police the industry, has fared poorly over the past 18 months amidst an onslaught of Trump admin crypto policy.

So why would any Democrats support this legislation? Given that the industry, which is now tethered to the excesses of Trump’s corruption, remains astoundingly unpopular and unimportant to voters, a “no” vote seems like a no-brainer. That is, unless you’re hoping the pro-crypto Fairshake PAC will spend some of its $150 million in cash on hand on you. 

Politicians of both parties have hitched their wagons to the crypto train in recent years. Alsobrooks and Gallego’s senatorial careers were forged in the $175 million bloodbath of 2024 crypto election spending; they’ve only grown more attached to the industry since then. Both candidates sport an “A” ranking from Stand With Crypto, the industry’s disciplinary arm. But as Trump has made America the “crypto capital of the world,” a commitment to this industry is increasingly difficult to square with either strident anti-Trumpism or even basic democratic principles. 

While in the House, Gallego was a member of the Congressional Progressive Caucus who rallied against special interests, applauding when Rep. Andrea Salinas (D-OR) “slayed the Crypto beast” in her 2022 election. Since making the jump to the Senate,  he has ditched the progressive veneer to punch left on border security and embrace Big Tech. As the ranking Democrat on the Senate Subcommittee on Digital Assets, he has hosted fundraisers with Trump-supporting billionaire and crypto investor Marc Andreessen and with Andreessen’s registered crypto lobbyist, Mike Smith. Gallego may very well owe his current position to crypto, having received $10 million in support from pro-crypto super PAC Protect Progress in 2024. 

Alsobrooks’ path to embracing crypto is a bit different than Gallego’s. Her 2024 campaign touted economic populist bona fides like her parents’ working class background and her track record as Prince George County Executive, but nothing in her biography suggests an interest in crypto. 

But when Fairshake signaled intentions to repeat the tactics it used to help wash Katie Porter out of the California senate primary, Alsobrooks and her opponent, David Trone, became mid-race crypto experts. Within days she answered Stand With Crypto’s questionnaire, admitting to zero experience in crypto trading, but dutifully agreeing with each talking point, including the dubious claims that crypto is “supporting millions of jobs” and that falling behind in crypto would put American national security “at risk.” After taking office, Alsobrooks cosponsored the GENIUS Act — which aims to create a regulatory framework for so-called “stablecoins” — and began touting digital assets as a path to generational wealth. At the end of the Clarity Act’s markup, she spoke of her 20-year-old daughter who, along with her peers, apparently view the digital asset revolution as their shot at making it big. This story may be Alsobrooks’ new stump speech: she told a similar one at a conference in March.

Ultimately, belief in the bill’s ability to regulate the crypto industry requires belief in the validity of a key industry shibboleth: regulatory clarity. As the crypto journalist Jacob Silverman has long argued, the industry has spent years insisting that existing financial regulations shouldn’t apply to crypto and new (less stringent) ones need to be crafted. Even if this were true, new laws alone wouldn’t stop the crypto moguls who routinely disregard existing ones. Moreover, it would be astonishingly naive to simply judge laws which require federal enforcement as they are written, especially as the current administration takes a sledgehammer to independent agencies.   

Perhaps the absurdity of the industry’s requests is why the benefits of allying with the crypto industry are waning.  A recent Fed report found that only 10% of people bought or used crypto for any purpose last year. When the crypto trade publication CoinDesk commissioned a study last month, they found that only 1% of voters surveyed consider crypto their top priority, and that much of the public associates the industry with “scammers” and “Ponzi Schemes.”

For all intents and purposes, being pro-crypto does nothing to earn a candidate new flesh-and-blood voters. Crypto super PACs seemingly recognize this, as their ad campaigns never talk about cryptocurrency, instead borrowing a page from the AIPAC playbook and boosting unrelated smears. 

One recent race offers a possible model for how to fight back against crypto spending. In March, Fairshake and Protect Progress bet $10 million to boost Rep. Raja Krishnamoorthi over Lieutenant General Juliana Stratton in Illinois’ Democratic primary. Stratton had no crypto record to speak of, but instead of backing down like Alsobrooks did, she flipped the script and pointed out the irony of a MAGA-aligned industry supporting her Democratic adversary; in the end, crypto failed to buy the election. Stratton’s response supports findings from a recent Brennan Center poll: the overwhelming majority of voters hate corruption, a prime example of which is prioritizing special interest donors over constituents. 

Since the Clarity Act’s fate is still in the balance, there’s still time for Alsobrooks and Gallego — or any crypto-friendly Democrats — to decide who they stand with: crypto billionaires or everyday people. 

Image credit: WASHINGTON, DC – JUNE 01: Sen. Ruben Gallego (D-AZ) talks to reporters as he heads for a vote at the U.S. Capitol on June 01, 2026 in Washington, DC. Senate Majority Leader John Thune (R-SD) and Senate Republicans are navigating President Donald Trump’s “anti-weaponization” fund and its impact on passing a reconciliation bill this week. (Photo by Chip Somodevilla/Getty Images)