This is the third in a series of stories examining the crypto industry’s high-stakes foray into politics and campaigns in 2024. The first explored the electoral history of Fairshake PAC’s strategy and the second its intense use of a 2010 Supreme Court position.
The corporate leaders responsible for the river of money that flooded American political shores this year have already benefited enormously from last month’s election result: they increased their personal fortunes by billions of dollars, far outstripping the huge spending they dedicated to cryptocurrencies. candidates.
Coinbase Inc. (COIN) CEO Brian Armstrong and his company dedicated some $74 million to the industry’s dominant political action committee, Fairshake, putting Armstrong in a narrow lead over some other crypto experts . This is an especially significant amount of money from a company that posted around $95 million in profits in 2023. But the election went its way and the company’s value has skyrocketed by $21 billion since November 4 , the day before in-person voting began and the result became clear.
In a series of pre-scheduled trades that began less than a week after the election, Armstrong sold $100 million worth of his Coinbase shares. Those same shares the night before the election were worth about $39 million less. A week after that, he cashed in around $313 million, all as part of a selling strategy he had put in place if the price rose.
Since then, the co-founder and CEO has sold smaller amounts week after week, totaling about $437 million in shares that were worth $308 million before the victories of President-elect Donald Trump and a slate of congressional lawmakers. backed by cryptocurrencies. In other words, the pro-cryptocurrency sentiment that emerged after the election result that Armstrong helped shape earned him an additional $129 million in wealth from the shares he sold.
He still owns more than 10% of the largest US cryptocurrency exchange, and the value of around 24 million shares held in his trust, according to the latest Securities and Exchange Commission filings, is about $6.4 billion , an increase of nearly $2 billion since November 5. .
Armstrong’s stock sales were planned less than three months before the U.S. election, laid out in a formal strategy aimed at distancing corporate executives from accusations of misleading markets. And the sales have not yet reached the midpoint of the SEC’s disclosed intention to offload up to 3.75 million shares, depending on the stock price meeting “certain threshold prices specified in the Armstrong Plan.”
He took to social media site He said he had set price targets so high that he didn’t expect most of it to be sold next year “unless we do much better than expected.” COIN shares are currently trading around $276, down from $186 on November 4.
A Coinbase spokesperson referred CoinDesk to that post when asked for comment.
His rivals among crypto leaders who devoted similar levels of cash to the election included Ripple Labs CEO Brad Garlinghouse and the eponymous heads of investment firm Andreessen Horowitz (a16z). Ripple donated $73 million and a16z contributed $70 million, including large amounts held back for the next election cycle in 2026.
Garlinghouse reportedly owns more than 6% of Ripple, the company, and a large, but unspecified, amount of the token linked to it, XRP. As a result, several reports place him high on the list of American billionaires. In the wake of the election, XRP skyrocketed to become the third-largest crypto asset by market capitalization.
While Garlinghouse chose not to give details about his net worth, he credited excitement over Trump’s return to the White House in a statement to CoinDesk.
“The cryptocurrency market is up over a trillion dollars since Trump won; that’s the price of Gensler’s foot on the neck of the market, and it’s not even officially gone yet,” Garlinghouse said.
Since the election, Garlinghouse’s XRP holdings have more than tripled as the token’s price jumped from $0.50 to $2.32. And while Ripple Labs’ private valuation is uncertain and was last set at around $11 billion earlier this year, the pick has almost certainly increased the value of its core stake. As a result, Garlinghouse’s personal wealth has likely skyrocketed.
The financial status of Mark Andreessen and Ben Horowitz is even murkier, but both have gained dramatically since last month thanks to their many holdings in cryptocurrency companies, likely surpassing the money they dedicated to American politics. But financial figures are not available for a16z’s investments in private companies as they are for public Coinbase.
The company’s extensive cryptocurrency portfolio includes stakes in Coinbase, Uniswap, Solana, EigenLayer and Anchorage Digital and dozens of others. Virtually all became more valuable as the U.S. executive branch will be led by Trump, who says he will be crypto president, and the 535-member Congress includes about 300 expected to support digital assets, including dozens that they just supported. by Fairshake in their elections.
But a company spokesperson declined to comment on CoinDesk’s review of Andreessen and Horowitz’s earnings as individuals.
A16z’s immersion in American politics was intended to “help promote clear rules that will support American innovation while holding bad actors accountable,” according to a post by the firm’s Chris Dixon.
Separately from Fairshake, Andreessen and Horowitz backed Trump’s election effort. And Andreessen has become an adviser to the pro-crypto president-elect as he prepares to begin his second term next month.
Crypto benefactors Coinbase, Ripple and a16z combined to make super PAC Fairshake and its affiliates the most powerful corporate campaign finance effort in the 2024 elections, helping 53 members of Congress next year win their races. However, Fairshake did not intervene in the presidential election, which may have had the largest effect on cryptocurrency market prices.
Garlinghouse, in a post-election interview on 60 Minutes, said: “I think it’s clear that Donald Trump embraced cryptocurrencies and cryptocurrencies embraced Donald Trump.” While he did not take credit for Trump’s success, Garlinghouse said crypto PACs “absolutely helped empower the candidates” and influenced the outcomes of legislative races.
His company pledged $5 million in XRP for Trump’s inauguration (next month’s celebration of his return to the presidency) and Coinbase and fellow American cryptocurrency exchange Kraken also raised their hands to fund it.
During the election, critics accused the cryptocurrency industry of being remarkably transactional in its political strategy: putting money in the best places to guarantee future votes in favor of cryptocurrencies in legislation and buying more than $130 million in ads Congressional campaign frames with frames around the world. Political spectrum (and not to mention cryptocurrencies). The gains for the sector have been a boost for the three main companies behind Fairshake and their individual leaders, who are financially linked to them.
The sector’s political effort was made “purely based on industry-specific interests,” said Rick Claypool, research director at Public Citizen who examined cryptocurrency campaign spending. “In the short term, this has obviously caused a huge surge in cryptocurrencies.”
The return on investment for industries that pour money into politics can “often be quite good,” said Mark Hays, senior political analyst at Americans for Financial Reform, who has also worked on campaign finance issues. “Cryptocurrencies are newer and therefore the opportunities for growth are greater.”
While Armstrong and the others prefer a political narrative that presents a surge of grassroots crypto voters that swung the election, he and his company were directly behind the establishment of Stand With Crypto, the group presenting itself as a grassroots effort to leverage the will of crypto voters. And Fairshake’s political influence was based almost entirely on money from Coinbase and associated companies, plus smaller amounts from Jump Crypto and Gemini.
Gemini leaders Tyler and Cameron Winklevoss were also among Trump’s most enthusiastic cryptocurrency fans.
The day after the vote, Cameron Winklevoss posted on will invest this money in We are building the future of money.
On November 11, the day Armstrong began selling large amounts of Coinbase stock, Tyler Winklevoss posted: “Chains off, 100k in.” Bitcoin hit that mark a month after the election.
