The 2024 election features a lot of firsts.
We’ve seen the first sitting president to withdraw from the race after securing enough delegates to win his party’s nomination. The first woman of color seeking the presidency. The first person convicted of (and facing more) felony charges running against her.
It’s also the first presidential race in which crypto currency could play a major role.
Blockchain companies have supplied 48 percent of the $248 million of corporate money donated to influence federal elections this cycle, according to research by the nonprofit watchdog group Public Citizen.
To be fair, most of that money is going to the bipartisan pro-crypto PAC Fairshake, the industry's dominant political action committee. It then distributes the funds to candidates on both sides of the aisle who support digital asset goals.
But we can’t overlook the fact that one of the people who helped Republican vice presidential nominee JD Vance win his Ohio Senate seat was billionaire Peter Theil. The PayPal founder is a big, although now a bit trepidatious, Bitcoin guy.
Crypto, campaigns, and concerns: So, with the Nov. 5 election just more than two months away, today’s multiple Saturday Shout Outs go to items exploring the role that crypto might play in who gets to occupy the Oval Office in 2025.
A quick preface. Some of this links require you to register (but not pay) for access. I know, invasive, so I wanted to warn you. But I also wanted to include them because they do offer some insight into this topic.
Now, here are today’s shout outs.
Big Crypto, Big Spending: Crypto Corporations Spend an Unprecedented $119 Million Influencing Elections by Rick Claypool for Public Citizen. The story has a link to the full report.
Crypto is dominating corporate election spending by Brady Dale for Axios.
2024 Election: The Role of Crypto by Grayscale. The crypto asset management firm commissioned a Harris Poll on the topic, which found “crypto has solidified its place in America’s financial future and in the 2024 presidential election.”
Crypto is the new Trump family business. Ethics watchdogs have concerns by Jasper Goodman for Politico.
But just how sound is the former president’s eldest sons’ latest venture is a big question, as it appears to have hit, for now, a familial roadblock.
Trump punts on promise to deliver plan to make U.S. ‘crypto capital of the planet’ by MacKenzie Sigalos and Christina Wilkie for CNBC. Also check out the video atop the story, in which Sigalos, in a CNBC Squawk Box segment, breaks down Public Citizen’s crypto campaign findings.
The earlier mention of campaign ethics concerns leads us to another crypto issue. The digital asset is widely seen as a payment method used by criminals. That’s tied together in the next shout out.
Naked Emperors and Crypto Campaign Cash by Paul Krugman for the New York Times. The Nobel Prize winning economist notes that Bitcoin “has yet to find significant uses that don’t involve some sort of criminal activity. The crypto industry itself has been racked by theft and scams. … Cryptocurrencies, which are traded for other crypto assets but otherwise mainly seem suited for things like money laundering and extortion…."
And some of crypto’s criminal activity has been in evading taxes, in the United States and globally.
Crypto tax evasion is ‘pervasive’ But is it big enough for tax authorities to care? That’s the question posed by Robin Wigglesworth in Financial Times. Wigglesworth points to a study of Norwegian crypto owners that found “crypto tax non-compliance is pervasive, even among investors trading on exchanges that share identifiable trading data with tax authorities. What exactly is ‘pervasive’? The paper estimates that 88 per cent of all Norwegian crypto holders fail to declare their hopium to the tax authorities.”
And that citation brings us to this weekend’s final Saturday Shout Out.
Crypto Tax Evasion, a National Bureau of Economic Research (NBER) working paper issued this month by Tom G. Meling, Magne Mogstad, and Arnstein Vestre. If you don’t have access to NBER via work, visitors to the Cambridge, Massachusetts-based nonprofit policy research organization website can download for free three documents each year.
The NBER trio focused on Norway because the tax data on all its residents is public. That allowed them to “address key measurement challenges by combining de-anonymized crypto trading data with individual tax returns, survey data, and information from tax enforcement interventions.”
Meling, Mogstad, and Vestre also note that “since most crypto investors owe little in crypto-related taxes, enforcement strategies need to be well-targeted or cheap for benefits to outweigh costs.”
And with that, I’m off to count my crypto holdings. There, done, since it’s zero!
You also might find these items of interest:
- IRS unveils draft 1099-DA for future digital asset transaction reporting
- 'Bitcoin Jesus' accused of $48 million in tax evasion related to the crypto currency
- IRS virtual currency tax compliance enforcement can be improved, says agency watchdog
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Kay Bell
Elmer, thanks for your comment. This story is a good breakout of the political leanings, and fights, in Silicon Valley this election. https://www.nytimes.com/2024/07/29/technology/silicon-valley-politics-elon-musk-reid-hoffman.html?searchResultPosition=7 Thanks for reading, Kay
Elmer Stoup
I thought Peter Thiel was one of the few tech titans that support Republicans.
It’s hard to believe there aren’t a number of Democratic tech titans who are involved in cryptocurrencies and are also contributing to the Harris campaign.
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