A crypto mogul’s hidden hand in Vermont’s congressional race stunned observers. It’s a common trick.

The revelation this week that a cryptocurrency mogul’s million-dollar super PAC donation preceded state Sen. Becca Balint’s victory in the Democratic primary for Vermont’s open seat in the U.S. House stunned observers of the closely watched contest. But campaign finance experts say the move is an example of common techniques used to hide who is influencing federal races.

Seven Days reported Tuesday that the LGBTQ Victory Fund, which spent just $1 million on Balint’s behalf in the race, had recently benefited from a $1.1 million donation from Nishad Singh, a top executive at cryptocurrency exchange FTX. The political action committee’s financial disclosures make clear that the lion’s share of expenses outside of Balint’s race came from Singh’s donation.

Bitter debates about consumption from outside dominated the course of the two months before election day. LGBTQ+ and progressive groups, including the Victory Fund, would eventually spend $1.6 million to support Balint’s run, and her main rival, Lt. Govt. Molly Gray, tried hard to make this a liability by denouncing the influence of big money in politics.

And when Gray’s campaign went on the offensive about outside spending, the Balint campaign shifted attention to who those groups were.

“Molly Gray is very close to saying, you know, ‘We don’t want a gay agenda,'” Balint campaign manager Natalie Silver told VTDigger in an interview in late July. “She calls these ‘special interests.’ These are not special interests. These are gays. This is the LGBTQ community. These are not beet farmers. This is not big ag. This is not oil. These are people who are afraid for their lives right now.”

It was talk that resonated on the ground — a local LGBTQ+ group almost asked Gray not to march in their parade — and was often repeated by media and pundits alike.

“I made a lot of media appearances acknowledging what I thought was an effective point that the Balint campaign was making — which is that by attacking outside spending,

The Gray campaign ran the risk of appearing to attack the goals of the group doing it outside of spending, said Matthew Dickinson, a professor of political science at Middlebury College.

Dickinson stressed that he had been careful to suggest that he agreed with the implicit criticism that Gray’s camp was dealing in homophobia – and that there was no evidence that Balint’s camp knew who was behind the external funds.

But he believes that had it been made public before the election, Singh’s donation would have affected the narrative of the race, if not the outcome. (Balint won in a blowout.)

“Had I known the money was actually coming from the cryptocurrency dealer, I probably would have been focused on something else,” Dickinson said.

The Victory Fund had just $153,000 in the bank in July. Singh’s donation was the largest lump sum the PAC has ever received, according to Seven Days. This accounted for 98% of the money the group took in during the month of July.

“We are proud to have received support from a diverse group of donors, and we make decisions about which candidates to support independently,” Elliot Imse, a spokesperson for the Victory Fund, wrote in a statement.

Singh has clear connections to another PAC that supported the Balint campaign. In June, the candidate received the endorsement of both Protect Our Future, a super PAC that works to elect candidates committed to pandemic prevention, and Guarding Against Pandemics, a separate PAC. The organizations are run by Sam Bankman-Fried, the founder of FTX and an MIT classmate of Singh’s, and Gabe Bankman-Fried – Sam’s brother, respectively. Both Sam and Gabe Bankman-Fried each donated $2,900, the maximum amount, to Balint’s campaign.

Singh and Sam Bankman-Fried are acolytes of “effective altruism,” a controversial philosophy around charity that has become particularly popular among the titans of Silicon Valley. But while Bankman-Fried has argued that his political contributions are meant to push elected officials to prepare for the next pandemic, many suspect that a light-touch approach to cryptocurrency regulation is also what he’s after.

Balint’s team had sought approval from Guarding Against Pandemics. When Gray’s team criticized Balint for also receiving the endorsement of Protecting Our Future, the super PAC, Balint’s team said they had not been aware of the group’s support — noting that Gray had also met with Guarding Against Pandemics.

In the weeks following those endorsements, Balint would also update his campaign website to include verbatim pandemic preparedness talking points offered by the group, Seven Days noted. The updated language was included on Balint’s website sometime between June 5 and July 10, according to the Wayback Machine, an Internet archive.

“The People at the Table”

In a post-Citizens United world, political action committees can now spend unlimited amounts of money on advertising for and against candidates. The only catch is that they cannot coordinate with the campaigns they are trying to help.

But such groups are allowed to coordinate among themselves – and they often do. PACs behind a particular candidate will typically meet at what is informally called “a table,” said Mike Mikus, a veteran Pennsylvania-based Democratic strategist who has worked on gubernatorial and U.S. Senate campaigns. (He has not worked in Vermont, and was not involved in either Balint’s or Gray’s campaigns.)

One of the first things the “table” will do is poll voters to find out who the most effective messenger would be, he said. When the results are in, the PACs involved will come up with a division of labor.

“Basically, the people at the table make a decision: ‘OK, we’re going to make TV from this group. We send the email from this group. Radio from this group. Digital from this group. And everything is done to maximize the impact,'” said he.

In fact, polls circulated in Vermont as early as June asking voters whether they would be more or less inclined to vote for a candidate supported by such groups as the Equality PAC (another LGBTQ+ group) and the House Progressive Caucus.

Despite all the talk of “dark money” in this race, the money behind the outside spending in this contest has been made public with the Federal Election Commission. But the way Singh’s $1.1 million was distributed ensured his role would not be known until after the primary.

Under federal rules, political action committees that make large independent expenditures must disclose those expenditures almost immediately. That’s why it was public throughout the month of July – and heavily covered by the media – that the Victory Fund and other LGBTQ+ and progressive groups had weighed in on the race.

But even if such expenses from political action committees basically have to be reported right away, what about the money raised is reported on a different schedule.

Had Bankman-Fried’s PAC, Protect our Future, spent large sums directly on Balint’s behalf, this would have been known almost immediately. But by giving the Victory Fund $1.1 million after June 30, Singh’s cash can be kept hidden — perfectly legally — until Aug. 20, the monthly filing deadline for reporting donations received in July.

“A lot of times a donor might have their own super PAC, but they don’t want to draw attention to themselves before the election,” Mikus said. “So what they do is they find a group that’s willing to take their money — whether it’s money from the group or from the individual — and they’re able to achieve their goal without the backlash.”

Through Silver, her campaign manager, Balint declined to be interviewed but answered questions posed in writing. She also criticized VTDigger’s question.

“The tone and the innuendo suggests that I’ve done something wrong, and I haven’t,” she said.

Balint wrote that she did not know “this person” who had donated to the Victory Fund. And she noted that federal law prohibits her from coordinating with the independent spending arm of the Victory Fund, writing several times that she had “no control” over their fundraising and spending. She also vigorously defended the organization.

“The Victory Fund represents the broad LGBTQ community in this country, and it gives a voice to so many, while pushing back against a very hostile and homophobic political environment. I support their work, she wrote.

When asked what political commitments, in light of the revelation of Singh’s donation, she wants to make to reassure Vermonters of her independence, Balint specifically did not mention cryptocurrency. But she called for sweeping campaign finance reform — something she has done many times before.

“I did not want this money to be used on my behalf. I don’t think it is healthy for democracy to have this kind of money involved in elections. That’s why I will push hard for campaign finance reform when, hopefully, I win in November and am able to serve in Congress,” she said.