Bitcoin skyrockets past $50k as Musk, Kutcher fuel rally – With insights from The Wall Street Journal

In those early years, Todd White, a lobbyist with the firm Rulon & White Governance Strategies, said he couldn’t convince cryptocurrency companies they needed help in Washington.

“The industry itself did not understand the power of lobbying. They just woke up in the last couple of weeks, and now there’s an opportunity to really morph,” said Mr. White, who now represents a new group called Government Blockchain Association.

Former congressman Mike Conaway, an eight-term Texas Republican who didn’t seek re-election last year, is now registered to lobby for Ripple Labs, a cryptocurrency startup. Howard Schweitzer, former general counsel of the Export-Import Bank and chief operating officer of the government’s TARP program, lobbies for Bitcoin Association for BSV, an industry group that says it supports an offshoot of bitcoin.

Like the decentralised currencies it embraces, the industry doesn’t have a singular voice in Washington. And the libertarian roots of the bitcoin movement made many of its adherents wary and disdainful of anything involving the government, even as its underlying technology caught on in Silicon Valley, Wall Street and corporate America.

Some of the lobbyists conceded those dynamics have been problematic.

The Chamber of Digital Commerce, an industry group started in 2014, rankled many of its members when it invited banks, consulting firms and tech companies that had only marginal attachments to cryptocurrencies to join its ranks. In 2020, Coinbase, the largest crypto exchange in the US, left the Blockchain Association, a separate industry group the company helped found two years earlier. The schism occurred after the association granted membership to a Coinbase rival, Binance, whose affiliates ran into a host of regulatory issues abroad.

That fragmentation and a lack of resources helped explain why many in the industry were unaware of and unprepared for the infrastructure-bill provision introduced by Mr. Portman. Some groups, including the Chamber of Digital Commerce, spoke frequently with members of Mr. Portman’s staff as the provision was being crafted, while others, including Coin Center, didn’t.

Still, there were clues something like the measure was in the offing. In May, the Treasury Department said in a report that it hoped to raise additional revenue in the following fiscal year by expanding the information that cryptocurrency brokerages have to report to the government to crack down on tax evasion.

Once Mr. Portman’s provision was made public in late July, though, the disparate crypto groups joined together. A joint statement calling the provision’s requirements “unworkable” attracted five signatories, including Coinbase and the Blockchain Association, which reconciled.

Coinbase also reached out to, and found a sympathetic ear in, Mr. Wyden, who had a record of defending emerging technology and individual privacy. Mr. Wyden filed an amendment to the infrastructure bill clarifying the definition of crypto broker along with Mr. Toomey and Ms. Lummis.

Those senators have more than just a passing interest in crypto. In June, Mr. Toomey had invested between $2,000 and $30,000 in bitcoin and ethereum trusts. Ms. Lummis hails from a state that changed laws to make it hospitable to digital-asset businesses and has disclosed between $100,000 and $250,000 worth of bitcoin holdings.

Meanwhile, cryptocurrency fans on social media heeded a call from Fight for the Future, a nonprofit advocating for a more open internet, to contact members of Congress over the bill. The #DontKillCrypto campaign, amplified by Messrs. Dorsey and Kutcher, prompted more than 40,000 calls to legislators.

“The results blew us away,” said Lia Holland, Fight for the Future’s communications director. “If we’d driven 5,000 calls, we definitely would have called that a success.”