Jeff Albus

This is a segment from the Lightspeed newsletter. To read full editions, <a href="https://blockworks.co/newsletter/lightspeed" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Have you ever wondered why stock trades take days to settle? Have you ever looked at the UX nightmare that is fractional ownership and thought, How in the world is this still the norm? And why is it exactly that your shares must live inside custodial black boxes?



These design failures boil down to the fact that the US equity market is fundamentally outdated. It&#8217;s <a href="https://ir.nasdaq.com/news-releases/news-release-details/nasdaq-study-shows-legacy-technology-and-regulation-preventing">trapped</a> inside legacy infrastructure, shackled by intermediaries and probably <a href="https://www.zdnet.com/article/if-cobol-is-so-problematic-why-does-the-us-government-still-use-it/">coded</a> in COBOL.



Efforts to modernize the system are usually surface-level. We might get faster messaging or marginally updated interfaces, but the core always seems to remain untouched. Hence, we live in a holding pattern of settlement delays, bloated fees and an ecosystem that is as opaque as it is exclusionary.



Enter Project Open, a <a href="https://www.sec.gov/files/ctf-written-project-open-wireframe-04282025.pdf">newly submitted SEC pilot proposal</a> with blockchain at its core. Jointly proposed by the Solana Policy Institute, Superstate and Orca (and with legal support from Lowenstein Sandler), Project Open is a <a href="https://x.com/SolanaInstitute/status/1917650618677686764">request</a> for exemptive relief that would allow equity securities to be issued, registered and traded directly on public blockchain networks like Solana.



The Solana Policy Institute, which <a href="https://www.solanapolicyinstitute.org/blog/announcing-the-launch-of-solana-policy-institute">launched</a> at the end of March, is a non-partisan advocacy group <a href="https://blockworks.co/news/solana-policy-institute-ceos-political">aiming to help policymakers</a> understand the role public blockchains can play in economic and social infrastructure. Project Open is its first major public action.



The group <a href="https://www.sec.gov/files/ctf-written-project-open-wireframe-04282025.pdf">submitted</a> a 20+ page legal framework to the SEC&#8217;s <a href="https://blockworks.co/news/sec-new-crypto-task-force">crypto task force</a> this week, complete with registration pathways, KYC onboarding, smart contract-based settlement, investor education modules and blockchain-native transfer agent roles.



Issuers would file traditional-style registration statements, which is same-same with how we do things now. The main difference involves using a digital token class instead of paper shares. Transactions would settle instantly, wallet-to-wallet, onchain.



Project Open takes a head-on approach to compliance, proposing a pilot program with a gated issuer cohort, 18-month duration and SEC oversight baked in.



Investors would hold &#8220;Token Shares&#8221; in whitelisted wallets after passing KYC and educational onboarding. A registered transfer agent would track all shares using the blockchain as the system of record, with super-admin rights to fix errors, recover assets or enforce restrictions. No custodians. There wouldn&#8217;t be any net settlement. No post-trade ambiguity. Just delicious, deterministic finality.



Project Open proposes trading on rails using smart contracts (a la Orca AMM or bilateral P2P swaps) rather than traditional exchanges. The filing even outlines how tokenized trading mechanisms would navigate existing rules like Reg NMS and broker-dealer custody requirements — or bypass them via targeted exemptions.



It&#8217;s frankly an opportune time for this proposal to land, what with <a href="https://blockworks.co/news/gary-gensler-resigning">Gary Gensler out</a>, the subsequent <a href="https://blockworks.co/news/sec-potential-shift-enforcement-actions">rollback of enforcement actions</a>, and new SEC Chair Paul Atkins <a href="https://blockworks.co/news/sec-chair-nominee-crypto-past">signaling</a> openness to &#8220;huge benefits&#8221; from blockchain infra.



We&#8217;ve heard a similar song a lot lately. In his investor letter last month, BlackRock CEO Larry Fink <a href="https://www.blackrock.com/corporate/investor-relations/larry-fink-annual-chairmans-letter">said plainly</a>:



&#8220;Every stock, every bond, every fund — every asset — can be tokenized. If they are, it will revolutionize investing. Markets wouldn&#8217;t need to close. Transactions that currently take days would clear in seconds. And billions of dollars currently immobilized by settlement delays could be reinvested immediately back into the economy, generating more growth.&#8221;



If he&#8217;s right, then Project Open may be the first serious attempt to give that future a regulatory foundation in the US.



The goal is for internet capital markets to settle in seconds, run on open infrastructure, and restore user-level control. Faster, fairer, cheaper, smarter, with the opacity dial thinned to nil.



Project Open reads like the culmination of years of onchain trial and error. It&#8217;s the sober recognition that blockchain tech is ready for real finance, not just DeFi.&nbsp;



If the SEC says yes, even conditionally, it would be a meaningful convergence of TradFi and crypto — on the scale of ETFs, and just as important as tokenized Treasurys onchain.&nbsp;



If it says no, the status quo holds&#8230;for a little longer, anyway.



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Lightspeed Newsletter

Project Open makes its case to the SEC

Shalini Nagarajan

Prominent lobby groups in conventional finance have raised concerns with the UK government regarding its intentions to regulate the crypto sector, warning against granting legitimacy to a market the groups say pose risks to consumers.



In February, the UK government <a href="https://blockworks.co/news/uk-crypto-regulation-in-the-works">initiated a consultation process</a> regarding its comprehensive 82-page policy proposal for the crypto industry.&nbsp;



The proposal emphasized the importance of enhanced dialogue between regulators and crypto companies, aiming to position the country as a competitive hub for sustainable finance.



Andrew Griffith, financial secretary to the UK Treasury, provided assurance in April that the consolidation of <a href="https://blockworks.co/news/uk-could-see-live-crypto-regulation-within-12-months">crypto regulations would be accomplished</a> over the course of the next year or so.



Meanwhile, some powerful lobby firms have warned about regulations normalizing crypto, per the <a href="https://www.ft.com/content/bb7df9d9-31bb-4b06-8478-749a37342532" target="_blank" rel="noreferrer noopener">Financial Times</a>.&nbsp;



In one of several responses to the consultation, which concluded in April, the Institute of Chartered Accounts in England and Wales (ICAEW), which represents the UK’s Chartered Accounts, <a href="https://www.icaew.com/-/media/corporate/files/technical/icaew-representations/2023/icaew-rep-037-23-hmt-consultation-and-call-for-evidence-future-financial-services-regulatory-regime.ashx" target="_blank" rel="noreferrer noopener">expressed</a> its support for the government’s aspiration to establish the most transparent, well-regulated and technologically advanced capital market globally.



But it warned that cryptoassets carry different risks than traditional assets for regulated activities.



“By expanding the perimeter and authorising firms for crypto related activities, consumers might be justified in concluding that the perceived risks that are known about cryptoassets have been to some extent addressed or managed,” it added. “We know that this is not the case. Many of the propositions are yet to demonstrate a clear business case or economics that justify current asset valuations.”



The government proposes to define cryptoassets as not just cryptocurrencies, but tokenized versions of traditional financial assets. It also potentially includes any encrypted information that holds “value.”



The International Regulatory Strategy Group (IRSG), representing finance lobby group TheCityUK and The City of London Corporation, emphasized the necessity for significantly improved precision in the definitions outlined within the proposals, as highlighted by The FT.



The group suggested that the government should reconsider the broad definition, since almost all electronic systems rely on encryption to transmit data packets that could be seen as having value.



Meanwhile, the FT also noted that the Chartered Institute of Taxation and Association of Taxation Technicians, expressed concerns about the practical challenges faces by its members in handling crypto transactions. They urged the Treasury to specifically address the tax treatment of cryptoasset transactions.



Separately, the UK’s Tax Authority is <a href="https://blockworks.co/news/uk-tax-crypto-confiscation">considering the implementations</a> of regulations that would grant the agency the authority to seize cryptoassets from businesses that have failed to meet their tax responsibilities.



James Carn, associate director in private client tax at wealth manager Evelyn Partners, told Blockworks that to ensure fairness, digital wallet funds should be accessible to HM Revenue &amp; Customs if the holders owes tax and refuses to pay.



“It is noted that some practical issues will need to be addressed, in particular how HMRC will access certain wallets,” he added. “HMRC noted that there could be technical challenges in directly accessing crypto wallets, but the conclusion of the consultation is that evidence and legal questions will be examined over the next year with a view to pressing ahead with the proposals.”



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lobbying

Finance Lobbyists Raise Red Flags on UK Crypto Policy

The Blockchain Association has filed further requests under the Freedom of Information Act (FOIA) as part of its quest to investigate the recent disintegration of crypto-friendly banks.



The group said in a <a href="https://theblockchainassociation.org/blockchainassociation-submits-additional-foia-and-foil-requests-to-further-investigate-de-banking-of-crypto-firms/">statement</a> dated April 14 that it had submitted requests for information to the Federal Housing Finance Agency (FHFA) and the New York Department of Financial Services (NYDFS).



Blockchain Association wanted to understand whether Signature Bank’s closure resulted from its insolvency or whether it was a regulatory decision to “send an anti-crypto message” despite the bank being fully solvent.



Furthermore, the association said it was investigating whether the Federal Home Loan Bank of San Francisco (overseen by the FHFA) made a politically-motivated decision “to take the extraordinary and unusual action of pulling a loan made to Silvergate only months earlier” before its failure.



Both Silvergate and Signature were considered key banks for crypto-focused companies, while Silicon Valley counted several crypto startups and venture capitalists as customers.



Silvergate wound down operations and said it <a href="https://blockworks.co/news/silvergate-intends-wind-down-operations">voluntarily liquidated</a> the bank on March 8. Silicon Valley Bank was <a href="https://blockworks.co/news/silicon-valley-bank-meltdown-has-little-to-do-with-crypto">forced to shut down</a> by federal regulators on March 10 after its investments significantly lost value. And fears of contagion led to the same happening with <a href="https://blockworks.co/news/new-york-community-bank-acquires-signature">Signature Bank</a> on March 12.



The additional requests come about a month after the group submitted <a href="https://theblockchainassociation.org/blockchain-association-submits-foia-request-to-investigate-de-banking-of-crypto-firms/" target="_blank" rel="noreferrer noopener">similar requests</a> to the Federal Deposit Insurance Corporation, the Board of Governors of the Federal Reserve System and the Office of the Comptroller of the Currency.



The crypto lobby group, dedicated to promoting innovation for the digital asset ecosystem, said it was investigating <a href="https://blockworks.co/news/fdic-grilled-crypto-bank-takeovers">allegations of de-banking</a> and regulatory actions that may have <a href="https://blockworks.co/news/chokepoint-2-0-efforts-effective">improperly contributed to the collapse</a> of Signature, Silicon Valley Bank and Silvergate.



“The crypto industry is building the next generation of the internet and financial services. This is important work that has created tens of thousands of American jobs. Businesses need bank accounts to pay employees, vendors, and taxes,” Blockchain Association’s CEO Kristin Smith said in a statement. &#8220;These are lawful businesses in the United States and should be treated like any other law-abiding business.&#8221;



Blockchain Association’s chief policy officer Jake Chervinsky is set to testify before the House Financial Services Committee on Wednesday in a hearing discussing stablecoin regulation.



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Banking

Blockchain Association Seeks Info on Regulators’ Crypto-Friendly Bank Crackdown

Ben Strack

Though US crypto companies pumped significant money into lobbying last year, there may be a consensus among industry participants that lawmakers and regulators have not done enough to create a comprehensive digital assets framework.&nbsp;



Some have been discouraged by <a href="https://blockworks.co/news/regulators-thought-crypto-would-die-barclays">a lack of regulatory clarity</a>, while others are likely to keep bolstering their presence in Washington, DC, during a critical period for the sector.&nbsp;&nbsp;



One of crypto’s top lobbyist groups said it remains undeterred.



The Blockchain Association spent $1.9 million on lobbying last year — up from $900,000 in 2021, according to a recent <a href="https://themoneymongers.com/exchanges/crypto-lobbying/">report</a> by the Money Mongers, which used data from <a href="https://www.opensecrets.org/">OpenSecrets</a>.&nbsp;&nbsp;



A Blockchain Association spokesperson said the organization intends to further increase its lobbying spending in 2023 but declined to comment further. The spokesperson confirmed the $1.9 million 2022 expenditure.&nbsp;



“Policymaker education is critically important for the industry,” Blockchain Association CEO Kristen Smith said in an email. “Explaining the current and future benefits of crypto networks, the promise and power of this technology, and the impact to our nation’s economy and jobs has never been more important.”



<h2 class="wp-block-heading">A standout year&nbsp;</h2>



Overall, crypto industry players shelled out roughly $25.6 million on lobbying last year, a year-over-year increase of 121%. Last year’s total is roughly equal to the amount spent over the five years prior combined, according to the Money Mongers report.&nbsp;



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1438" height="1190" src="https://blockworks-co.imgix.net/wp-content/uploads/2023/04/Crypto-lobbying-spend.jpg?w=1024&amp;h=1024" alt="" class="wp-image-51011" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2023/04/Crypto-lobbying-spend.jpg?w=1438 1438w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/Crypto-lobbying-spend.jpg?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/Crypto-lobbying-spend.jpg?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/Crypto-lobbying-spend.jpg?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/Crypto-lobbying-spend.jpg?w=311 311w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/Crypto-lobbying-spend.jpg?w=315 315w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/Crypto-lobbying-spend.jpg?w=265 265w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/Crypto-lobbying-spend.jpg?w=80 80w" sizes="auto, (max-width: 1438px) 100vw, 1438px" /><figcaption class="wp-element-caption">Source: The Money Mongers</figcaption></figure>



The only company to outspend Blockchain Association was Coinbase, which allocated nearly $3.4 million into crypto lobbying efforts last year. The crypto exchange had spent about $1.5 million on such efforts the year prior.&nbsp;&nbsp;



Coinbase used 32 lobbyists in 2022, OpenSecrets data shows — slightly more than its 28 the year before and more than quadruple the seven it used in 2020.&nbsp;



A spokesperson for the crypto exchange declined to comment.&nbsp;



But Coinbase is unlikely to shrink its presence in Washington, DC, after <a href="https://blockworks.co/news/sec-serves-coinbase-in-latest-alleged-crypto-securities-violation">receiving a Wells notice</a> from the SEC, a person familiar with the matter told Blockworks.&nbsp;



The SEC shared concerns last month about alleged securities violations, according to the notice — a letter that typically precedes an agency enforcement action.



Other crypto companies in the top 10 for lobbying spend in 2022 include Ripple Labs and Binance.US, which spent nearly $1.1 million and $960,000, respectively.&nbsp;



<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="940" height="1014" src="https://blockworks-co.imgix.net/wp-content/uploads/2023/04/Crypto-Lobbying-List-of-Companies-1.jpg" alt="" class="wp-image-51013" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2023/04/Crypto-Lobbying-List-of-Companies-1.jpg?w=940 940w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/Crypto-Lobbying-List-of-Companies-1.jpg?w=278 278w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/Crypto-Lobbying-List-of-Companies-1.jpg?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/Crypto-Lobbying-List-of-Companies-1.jpg?w=238 238w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/Crypto-Lobbying-List-of-Companies-1.jpg?w=242 242w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/Crypto-Lobbying-List-of-Companies-1.jpg?w=203 203w, https://blockworks-co.imgix.net/wp-content/uploads/2023/04/Crypto-Lobbying-List-of-Companies-1.jpg?w=74 74w" sizes="auto, (max-width: 940px) 100vw, 940px" /><figcaption class="wp-element-caption">Source: The Money Mongers</figcaption></figure>



Representatives for both firms did not immediately return requests for comment.&nbsp;&nbsp;



<h2 class="wp-block-heading">Lobbyist spending could plateau</h2>



The report comes as crypto companies <a href="https://blockworks.co/news/mike-pence-nephew-binance-newest-lobbyist">have hired lobbyists</a> in recent months, filings show.



A spokesperson for Binance previously told Blockworks that the arrest of FTX founder Sam Bankman-Fried in December spurred the exchange’s global business to bolster its presence in DC.



Though some lawmakers have said <a href="https://blockworks.co/news/crypto-legislation-wont-be-sexy">crypto legislation is a near-term focus</a>, concrete industry-specific rules still don’t exist.&nbsp;



Some companies, therefore, could choose to pull back.



Gabriella Kusz, CEO of the Global Digital Asset and Cryptocurrency Association, told Blockworks in an email that she expects lobbying spending to plateau in 2023.



“On one side, there will be a reduction by some companies in US lobbying as they have already largely repositioned overseas and no longer see influencing US policy as core to their business,” Kusz said. “On the flipside, you’re going to see some companies who will recognize the importance of passing legislation this year&nbsp; as crucial&nbsp; — as this year represents a window of opportunity ahead of the 2024 election cycle.”



In terms of companies giving up on US regulators, Bittrex said last week it would <a href="https://blockworks.co/news/bittrex-us-shutdown">shut down its US arm</a>. The company’s CEO, Richie Lai, cited “regulatory uncertainty” — as well as US lawmakers and regulators “seemingly committed to extinguishing the industry” — as reasons for the decision. 



The crypto exchange’s move to focus on its business overseas came as the SEC and CFTC have launched actions against companies in recent months in an apparent effort to continue <a href="https://blockworks.co/news/sec-ftt-complaint-is-yet-another-case-of-regulation-by-enforcement">regulating by enforcement</a>.



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Blockchain Association

Will Crypto Lobbying Spend Continue Big Growth In ‘Crucial’ Year?

Crypto firms are adding lobbyists as regulatory scrutiny is expected to intensify following a whirlwind year for the segment that featured the crashes of large industry players.



Binance has registered three new lobbyists from legal counsel firm Ice Miller, according to a <a href="https://lda.senate.gov/filings/public/filing/6a74c35b-89fc-45bf-bebf-8535e2be9fdd/print/" target="_blank" rel="noreferrer noopener">filing</a>, in a move spurred in part by the fall of one of the crypto exchange’s biggest rivals.



&#8220;Following <a href="https://blockworks.co/news/sam-bankman-fried-arrested-in-bahamas">the arrest of FTX&#8217;s former CEO</a>, Binance.com received several inquiries from congressional offices seeking our perspective,” a spokesperson told Blockworks in an email. “As Binance.com had never previously engaged in Washington DC, we sought government affairs consultants that understood both crypto and our CEO&#8217;s role in the industry.”



Ice Miller, which had previously supported Binance.US, was “a natural option,” the representative added. The exchange’s US arm first hired lobbyists from the firm in 2021, Politico <a href="https://www.politico.com/newsletters/politico-influence/2021/10/04/binanceus-rover-add-first-lobbyists-798018" target="_blank" rel="noreferrer noopener">reported</a>.



The latest lobbyist additions, which went into effect Tuesday, include the nephew of former US Vice President Mike Pence.



John Pence, now Ice Miller’s director of public affairs, was a senior adviser for the Trump-Pence presidential campaign from 2016 to 2020.



He “helps with issue monitoring and engagement at the federal level for clients,” according to the Ice Miller’s website. Pence is not licensed to practice law in any state and does not provide legal services.



Jarrod Loadholt and Meagan Bolton are also set to lobby for the crypto exchange, the filing shows.&nbsp;



Loadholt, a partner in Ice Miller’s public affairs group, formerly acted as a senior counsel to the US House of Representatives’ Subcommittee on Financial Institutions and Consumer Credit. He also worked as senior oversight counsel to the Oversight and Investigations Subcommittee.



More recently, Loadholt was head of Credit Karma’s first director of legislative and regulatory affairs, a role in which he managed the company’s government relations function.



Before joining Ice Miller, Bolton was technology, telecommunications and judiciary counsel for US Sen. Gary Peters, chair of the Homeland Security and Governmental Affairs Committee.&nbsp;



She was also previously the tech and telecom counsel for the US House Committee on Small Business.



A Binance spokesperson did not comment on what Pence, Loadholt and Bolton will be doing for the company specifically. The lobbyists’ assistant did not immediately return a request for comment.&nbsp;



<h2 class="wp-block-heading">Others looking to engage more with DC, too</h2>



Tether, Bakkt, a16z and Riot Platforms are also looking to lobby in DC, Politico first <a href="https://www.politico.com/newsletters/politico-influence/2023/01/31/k-streets-crypto-gold-rush-continues-00080529" target="_blank" rel="noreferrer noopener">reported</a>. 



Venture capital firm a16z has registered Collin McCune as its first lobbyist, a spokesperson confirmed. McCune <a href="https://a16zcrypto.com/collin-mccune/" target="_blank" rel="noreferrer noopener">joined</a> the company as its head of government affairs in November. 



For nearly four years before that, he was deputy staff director of the House Financial Services Committee.&nbsp;



“With crypto legislation now at the forefront of the policymakers’ minds, we felt it was essential to take this step,” an a16z representative told Blockworks.



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">
“We look forward to working with policymakers to ensure that crypto legislation strikes the balance of providing consumer protections while not stifling the future of Web3’s promise,” they said.
</blockquote>



Crypto marketplace Bakkt added Steptoe &amp; Johnson as a lobbyist in December, while Tether registered Continental Strategy to lobby on its behalf last month, separate filings show.&nbsp;



“We expect the legislative and regulatory conversation to accelerate this year and we plan to meaningfully contribute to it on important topics such as consumer protection, risk and controls, and sound governance,” a Bakkt spokesperson said.



The market capitalization of stablecoin <a href="https://blockworks.co/price/usdt" target="_blank" rel="noreferrer noopener">tether</a> is roughly $68 billion, behind only bitcoin and ether. Stablecoin regulation will be a major priority for Congress this year, Bitwise’s general counsel <a href="https://blockworks.co/news/stablecoin-regulation-congress-priority">told Blockworks</a> last month. 



&#8220;As the creator of the stablecoin, we feel it is critical for our voices to be heard so that we can help ensure lawmakers, regulators and anyone engaging in digital commerce have a complete and accurate understanding of the utility of these assets,” a Tether representative told Blockworks.



Riot Platforms also registered Brian Morgenstern as a lobbyist last month, according to a <a href="https://lda.senate.gov/filings/public/filing/13b31a1d-5633-4b36-b788-e7371412ee4a/print/" target="_blank" rel="noreferrer noopener">filing</a>, after hiring him as its head of public policy. 



Morgenstern was a deputy assistant secretary at the US Department of the Treasury and was a deputy communications director and special assistant to then-President Donald Trump.&nbsp;



A spokesperson did not immediately return a request for comment.



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a16z

Mike Pence’s Nephew Among Binance’s Newest Lobbyists

David Canellis

Disgraced FTX founder and former crypto billionaire Sam Bankman-Fried was a prolific donor to US politicians. Now, his beneficiaries are grappling with the realities of accepting his money.



Bankman-Fried has personally given more than $13 million to politicians and their campaigns on both sides of the aisle during this year&#8217;s election cycle. Ryan Salame, Bankman-Fried’s co-CEO, contributed almost $24 million to Republican campaigns, per <a href="https://www.thedailybeast.com/democrats-took-sam-bankman-frieds-shady-ftx-crypto-money-will-they-keep-it" target="_blank" rel="noreferrer noopener">The Daily Beast</a>.



Bankman-Fried reportedly gave more than $44,000 to the National Republican Congressional Committee (NRCC) this year, while NRCC Chair Tom Emmer received donations from Salame.



An additional $23 million was funneled to Democrats via a Bankman-Fried political action committee (PAC), while one tied to Salame gave more than $12 million to Republicans. 



Not to mention, the $5.6 million Bankman-Fried gave to President Joe Biden&#8217;s campaign leading up to the 2020 collection, second only to media billionaire Mike Bloomberg, who donated $56 million. 



In light of <a href="https://cms.blockworks.co/news/ftx-bankrupt-hacked-investigated-a-timeline-of-events/" target="_blank" rel="noreferrer noopener">swirling allegations</a> around Bankman-Fried, including that he siphoned billions of dollars in customer funds to fuel risky bets across the crypto ecosystem, Democrats Dick Durbin and Jesús &#8220;Chuy&#8221; García both told The Daily Beast they would donate the $2,900 they received from Bankman-Fried to undisclosed charities.



The situation is especially sticky given the odds that at least some of Bankman-Fried’s personal fortune came as a result of intentionally misusing user funds, although such allegations are yet to be explicitly proven.&nbsp;



Republican David Schweikert said he’d also give up his FTX-linked cash, which also amounted to $2,900 by way of Salame. “If the person who made an individual contribution engaged in bad acts, yeah, absolutely,” Schweikert reportedly said.



Ruben Gallego, Democratic representative of Arizona, took a different tack, telling reporters that he’d spent Bankman-Fried’s donation in support of Latina Congress hopeful Andrea Salinas.&nbsp;



Bankman-Fried had reportedly spent millions to defeat Salinas throughout Oregon’s Democratic primary. “I think I’ve paid it back,” Gallego said.



Democratic representatives Salud Carbajal and Lucy McBath received $5,800 and $2,900 from Bankman-Fried, respectively. McBath didn’t comment, according to the Daily Beast, which reported that her communications director said that she couldn’t answer questions while walking to the House floor.



Carbajal, who represents California&#8217;s 24th district, directed reporters to contact his office. A spokesperson later told Blockworks that Carbajal would indeed be donating Bankman-Fried&#8217;s money to a local charity &#8220;in our area that is aimed at boosting economic opportunity and financial literacy.&#8221;



Aside from those detailed above, The Daily Beast contacted 26 current and incoming lawmakers from both parties, all of which declined to comment or did not respond.



In any case, crypto in politics extends far beyond Bankman-Fried. Industry insiders, including venture capital firm Andreessen Horowitz, have made a <a href="https://www.bloomberg.com/news/articles/2022-03-08/crypto-lobbying-skyrocketed-last-year-and-quadrupled-since-2018" target="_blank" rel="noreferrer noopener">point</a> of lobbying lawmakers and sympathetic politicians over the past 18 months.



No doubt, Bankman-Fried has just made their job significantly more difficult leading into the next election.



Article updated to include comments from a Salud Carbajal spokesperson.



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