The CEO of Coinbase and other cryptocurrency insiders are billions richer after seeking to steer the election

This is the third in a series of stories examining the high stakes of the cryptocurrency industry in 2024 in politics and election campaigns. I explore Electoral register From the Fairshake PAC strategy and the second Extensive use Supreme Court position in 2010.

The corporate leaders responsible for the river of money that has flooded American political shores this year have benefited greatly from the results of last month’s election — increasing their personal wealth by billions of dollars, far outpacing the significant spending they have devoted to supporting cryptocurrencies. Candidates.

(COIN) CEO of Coinbase Inc. (COIN), Brian Armstrong and his company raised about $74 million to the industry’s dominant political action committee, Fairshake, putting Armstrong a close step ahead of a few other cryptocurrency insiders. That’s a particularly large sum from a company that generated about $95 million in profits in 2023. But the election went its way, and the company’s value has swelled by $21 billion since Nov. 4, the day before in-person voting began and the result was clear.

In a series of pre-programmed trades that began less than a week after the election, Armstrong sold $100 million worth of his Coinbase shares. The value of those same shares the night before the election was about $39 million less. A week later, he had about $313 million, all part of a selling strategy that he would initiate if the price rose.

Since then, the co-founder and CEO has sold smaller amounts week after week, totaling about $437 million for shares that were worth $308 million before the victories of President-elect Donald Trump and a group of congressional lawmakers backed by cryptocurrencies. In other words, the pro-crypto sentiment that rose after the election results and which Armstrong helped shape earned him an additional $129 million in wealth for the stocks he sold.

He still owns more than 10% of the largest U.S. cryptocurrency exchange, and the roughly 24 million shares held in his trust are, according to the latest Securities and Exchange Commission filings, worth about $6.4 billion — an increase of nearly $2 billion since November 5. .

The Armstrong stock sales were planned less than three months before the US election and were introduced in a formal strategy aimed at distancing corporate insiders from accusations of market manipulation. Sales have not yet reached the halfway point 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.”

Go to X’s social networking site Explain the plan Several days before the election, he said he was diversifying his investments “to make investments in successful projects” but would retain the “vast majority” of his shares. He said he has set target prices so high that he doesn’t expect most of them to be sold next year “unless we do much better than expected.” COIN stock is currently trading at around $276, up from around $186 on November 4.

A Coinbase spokesperson referred CoinDesk to this post when asked for comment.

His rivals among crypto leaders who have committed similar levels of money to the election include Ripple Labs CEO Brad Garlinghouse and the heads of the investment firm of the same name Andreessen Horowitz (a16z). Ripple donated $73 million, and a16z donated $70 million, including significant amounts reserved for the next election cycle in 2026.

Garlinghouse reportedly owns more than 6% of Ripple, and a large but unspecified amount of tokens associated with it. XRP. As a result, various reports placed him at the top of the list of American billionaires. Following the elections, The price of XRP has increased To become the third largest crypto asset in terms of market capitalization.

While Garlinghouse chose not to go into details about his net worth, he credited the excitement over Trump’s return to the White House in a statement to CoinDesk.

“The cryptocurrency market is up more than $1 trillion since Trump won — that’s the price of Gensler’s foot on the neck of the market, and he’s not officially gone yet,” Garlinghouse said.

Since the election, Garlinghouse’s holdings of XRP have more than tripled as the token’s price jumped from $0.50 to $2.32. Although Ripple Labs’ non-public rating is uncertain and was last set In the region of $11 billion Earlier this year, the election almost certainly boosted the value of his major stake. Garlinghouse’s personal fortune likely rose dramatically as a result.

The financial status of Marc Andreessen and Ben Horowitz is even more ambiguous, but both men have made significant gains since last month from their numerous stakes in cryptocurrency companies, which likely exceeds the money they have allocated to US politics. But financial numbers are not available for a16z’s investments in private companies as they are for public Coinbase.

Company Spacious crypto wallet It includes stakes in Coinbase, Uniswap, Solana, EggenLayer, Anchorage Digital, and dozens of other companies. Almost all of them have become more valuable as the US executive branch will be run by Trump, who says he will be the crypto president, and the 535-member Congress includes about 300 who are expected to back digital assets – including dozens just backed by Fairshake in their elections.

But a company spokesperson declined to comment on CoinDesk’s review of the gains made by Andreessen and Horowitz as individuals.

The goal of A16z’s immersion in American politics was to “help develop clear rules of the road that will support American innovation while holding bad actors accountable.” According to another From the company Chris Dixon.

Separately from Fairshake, Andreessen, and Horowitz She supported Trump’s election efforts. And Andreessen has Become a consultant The pro-crypto president-elect is preparing to begin his second term next month.

Crypto donors from Coinbase, Ripple and a16z have combined to make Fairshake super PAC and its affiliates the strongest institutional campaign finance effort in the 2024 election, helping 53 members of Congress next year win their races. However, Fairshake did not affect the presidential election, which probably had the biggest impact on cryptocurrency market prices.

Garlinghouse, V Post-election interview on 60 Minutes“I think it’s clear that Donald Trump has embraced cryptocurrencies and Donald Trump has embraced cryptocurrencies,” he said. Although he did not claim credit for Trump’s success, Garlinghouse said that cryptocurrency PACs “absolutely helped motivate the candidates” and influenced the results in congressional contests.

His company has pledged $5 million in XRP for Trump’s inauguration — next month’s celebration of his return to the presidency — and Coinbase and fellow US cryptocurrency exchange Kraken have also raised their hands to fund it.

During the election, critics accused the cryptocurrency industry of being notably transactional in its political strategy — placing money in the best places to ensure future pro-crypto votes on legislation and purchasing more than $130 million in congressional campaign ads with framing across the United States. The political spectrum (not to mention cryptocurrencies). The gains for the sector mean a boost for the three main companies behind Fairshake and its individual leaders, who are financially connected to it.

The sector’s political efforts have gone “exclusively to specific industry interests,” said Rick Claypool, a research director at Public Citizen who has examined cryptocurrency campaign spending. “In the short term, this has clearly caused a significant rally in cryptocurrencies.”

The return on investment for industries that invest money in politics can “often be very good,” said Mark Hayes, a senior policy analyst at Americans for Financial Reform, who has also worked on campaign finance issues. “Cryptocurrencies are newer, so the opportunity for growth is greater.”

While Armstrong and others favor a political narrative that shows a grassroots rise in cryptocurrency voters changing elections, he and his company were behind the creation of Stand With Crypto, the group described as a grassroots effort to harness the will of cryptocurrency voters. Fairshake’s political influence was based almost entirely on funds from Coinbase and partner companies, as well as smaller amounts from Jump Crypto and Gemini.

Gemini’s leaders, Tyler and Cameron Winklevoss, were also among Trump’s leaders Top fans in crypto.

The day after the vote, Cameron Winklevoss Published on X: “Imagine how much more we will have to achieve in the next four years so that the cryptocurrency industry does not bleed billions of dollars on legal fees fighting the SEC and instead invests that money in building the future of money. What lies ahead is amazing.”

On November 11, the day Armstrong began selling large amounts of Coinbase shares, Tyler Winklevoss to publish“The shackles have been removed, 100,000 are in.” Bitcoin Hit that mark A month after the elections.