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A recent research by independent think tank The Money Mongers revealed a massive spike in lobbying expenditure by crypto companies. Upwards of $50 million was spent by cryptocurrency firms trying to influence the US government's decisions in the past six years.
The Money Mongers Team conducted a study unveiling the massive expenditure of crypto companies on lobbying in the US. From $2.5 million in 2017 to $25.57 million in 2022, there has been a huge spike of 922%.
Since 2017, upwards of $50 million has been spent by crypto firms on lobbying. While lobbying may be labeled as bribery by people who don’t understand the system, it is a vital part of participatory democracy and is protected by the Constitution of the United States of America.
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Crypto exchange Coinbase spent $3.3 million, making it the highest spender in 2022, followed by the Blockchain Association and Robinhood at $1.9 million and $1.84 million.
Crypto firms’ lobbying expenditure
Binance.US and defunct crypto exchange FTX.US increased their lobbying expenditure by more than twice Year-on-Year. Since the goal of lobbying is to influence the government’s decision on crypto-related issues, it may be a factor among others, impacting on the market capitalization of cryptocurrencies.
Other factors influencing BNB and XRP prices over the past year have been US financial regulators’ investigations on crypto exchange Binance’s operations, halted issuance of BUSD by Paxos, the SEC’s lawsuit against payment giant Ripple and the tumultuous events of 2022.
Interestingly, Binance’s native token BNB and XRPLedger’s XRP prices climbed consistently since 2021, with the exception of the exodus events like Terra-LUNA collapse and FTX exchange’s bankruptcy in 2022. The two cryptocurrencies have recouped their losses since November 2022 and started short-term uptrends. BNB recovered from its 2022 low of $210 and is exchanging hands at $310, as of February 23.
XRP made a comeback above its 2021 low of $0.27, the altcoin is currently trading at $0.38. The increase in lobbying expenditure has resulted in an increased focus on cryptocurrency regulation. While the US Securities and Exchange Commission recently started a crackdown on crypto firms, several regions are working on favorable crypto regulation and policy frameworks like Hong Kong.
