Billion-fall slide: Why a crypto tycoon is rethinking election spending

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Billionaire crypto boss and political megadonor Sam Bankman-Fried has turned off the opening of campaign contributions with less than a month to go before the 2022 midterms. In an interview with MM, he insisted that was always part of the plan — even though everyone else thought he’d go bigger.

Bankman-Fried has dumped nearly $40 million into super PACs and campaigns during the 2022 cycle. And while that’s enough to make him one of the biggest donors in politics — with the bulk going to Democrats — it’s just a fraction of the $1 billion he previously said he’d be willing to spend on races between now and 2024 .

“That was a stupid quote on my part,” the 30-year-old founder of global crypto exchange FTX and trading firm Alameda Research said in an interview Wednesday. “I think my messages were a little sloppy and inconsistent in some cases.”

That’s bad news for Democratic leaders who have sounded the alarm over declining armories to fend off the GOP in November.

Bankman-Fried said so unleashing his fortune in the waning days of the race would do little to elevate his political priorities. In addition to new rules for crypto exchanges, the billionaire has also been a vocal advocate for pandemic preparedness.

“I think primaries are more important,” said Bankman-Fried, who was in Washington for conference appearances this week. “Honestly, I could try to talk about pandemic preparedness in a general election. But most voters will say, “That’s cool, but I’m a Democrat” or “I’m a Republican.” It’s not going to move the needle enough for me to go through all the other issues.”

What more, while the super PACs funded by Bankman-Fried and other FTX leaders have generally supported winning candidates in the primaries, they have also endured high-profile losses in some of the races in which they were most active.

“At some point, once you’ve given your message to the voters, there’s just not much more you can do,” Bankman-Fried said. “You can spend more time on it, and more messages, more money, more everything else, [but] you achieve nothing more.”

Read more of the Bankman-Fried conversation at POLITICO Pro.

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Deputy Treasury Secretary Wally Adeyemo convenes members of the global sanctions coalition against Russia’s invasion of the Treasury Department at 8 a.m. … Retail sales and import price data released at 8:30 a.m. … University of Michigan consumer sentiment data released at 10 a.m. … Federal Reserve Governor Lisa Cook speaks at a National Bankers Association- conference at 10.30 … Finance Minister Janet Yellen holds a press conference at the IMF at 1:30 p.m

ELON INVESTIGATED — Bloomberg’s Tom Giles: “Billionaire Elon Musk is being investigated by federal authorities in connection with his attempted acquisition of Twitter Inc., lawyers for the social media company wrote in a Delaware lawsuit.”

RAIMONDO ON RECESSION FEAR: EVERYTHING IS GOOD — Commerce Secretary Gina Raimondo said Thursday that she does not consider an economic recession to be certain. “The way I see it, a recession is not inevitable,” she said in an appearance on Bloomberg TV. “Certainly any kind of a significant recession, I think, is certainly not inevitable.”

PAYPAL’S WOES — Sen. Tim Scott (RS.C.) — set to become the top Republican on the Banking Committee next year — waded into the fintech culture wars this week in a letter to PayPal warning the company to reject a staggered policy update that would have fined users $2,500 for spreading misinformation. The company retracted the update not long after it went out, saying it was “never intended to be included in our policy.”

In another potential cultural flashpoint for banks, JPMorgan Chase and Ye – also known as Kanye West – severed ties after a series of social media attacks the rapper and designer lobbied against the bank, its CEO Jamie Dimon and other top executives.

While someone has tried to link Wednesday evening revelation to series of racist and anti-Semitic comments Ye has posted on social media over the past week, a source familiar with the letter said it was sent on Sept. 20 — days after the rapper told CNBC he was withdrawing his money. from JPMorgan because “Jamie Dimon never calls me.”

FED WHISPERS — Here’s a fun one: NY Magazine profiles WSJ Fed reporter Nick Timiraos. “On Wall Street and in Washington, Nick Timiraos, chief economist correspondent for The Wall Street Journal, is playfully referred to as the ‘Fed Whisperer’ or even ‘Chairman Timiraos’ for his recent prediction about the central bank’s next move,” writes Jen Wieczner.

Pretty accurate: “John Krasinski would be a lock to play Timiraos in a movie.”

STANDING FOR THE WORST – Bloomberg’s Lu Wang and Peyton Forte: “Wall Street hopes that the Federal Reserve may be able to ease the fight against inflation later this year were decisively dashed Thursday as September consumer price index data turned unexpectedly warm.”

DIMON DOWNER— Bloomberg’s Hannah Levitt: “Jamie Dimon said the Federal Reserve probably can’t cool the red-hot economy without triggering a recession.”

BUT, BUT, BUT— WSJ’s Karen Langley and Caitlin Ossoff: “U.S. stocks closed sharply higher Thursday in a head-spinning reversal, after investors decided new evidence of high inflation wasn’t as bad as it first appeared.”

ADVANTAGES JUMP — WSJ’s Anne Tergesen: “Social Security checks will be 8.7% bigger in 2023, the biggest cost-of-living adjustment to benefits in four decades, the Social Security Administration said Thursday. The additional funds will provide relief to many of the roughly 70 million Social Security recipients whose budgets have been stretched thin by high inflation and whose nest eggs have been battered by falling stock and bond markets.”

Dollars and cents: The average monthly benefit check for retirees will jump to $1,814 starting in January, up from $1,669 this year, per the WSJ.

BLACKROCK STUMBLE — WSJ’s Angel Au-Yeung: “A sour market weighed on investment giant BlackRock Inc. in the third quarter, pushing profits down 16%.”

KASTLES BACK-TO-OFFICE METER – Bloomberg’s Sarah Holder: “The 50-year-old company has become, if not exactly a household name, at least the best-known player in a not-so-sexy industry — and a key participant in the ongoing conversation about when, and whether, remote workers will return to their desks. If the office as we once knew it is dying, Kastle is determined to trace its final days.”

OCC CHIEF PRODS STARTUPS TO GROW UP — Coindesk’s Fran Velasquez: “Acting Comptroller of the Currency (OCC) Michael Hsu says the lack of focus by some crypto companies with plans to expand is preventing agencies like his from establishing regulatory standards. “Part of this confusion is because there are parts of the crypto industry who don’t know what they want to be when they grow up,” Hsu said.

DEFI IS STILL TRADING — Bloomberg’s David Pan: “Uniswap Labs has secured more funding even as the crypto market struggles and investors begin to lose confidence in decentralized finance. The exchange … said Thursday it has secured $165 million through a Series B financing round, valuing the company at $1.66 billion.”

A LESS THAN AWESOME VOYAGER – Bloomberg’s Jeremy Hill: “Voyager Digital Ltd. creditors take issue with plans to give crypto lender’s directors and officers immunity from lawsuits related to its decline into bankruptcy.”

Jamie Wall is now VP and head of the Washington office of ExxonMobil. She was most recently EVP of Advocacy at SIFMA and is an alum of Honeywell, Subject Matter and Sen. Roy Blunt (R-Mo.). – Daniel Lippmann

The global life and health insurance company Reinsurance Group of America appointed Steve Simchak and Christopher Winship to serve as vice president and head of the company’s Washington office and vice president of legislative and regulatory affairs for Asia, respectively.

The Federal Trade Commission, American business’ top watchdog, is also home to Washington’s most active Wall Street investors. – WSJ’s Brody Mullins, Rebecca Ballhaus, Chad Day, John West and Coulter Jones

Executives from US banking giants on Thursday said strict capital requirements, which were strengthened after the 2008 financial crisis, could limit economic activity. — Reuters Saeed Azhar and Lananh Nguyen

The leaders of Harvard University A $51 billion endowment has warned of significant declines in its private equity and venture capital portfolio, predicting big losses for institutional investors. — FT’s Antoine Gara