Former Crypto Mogul Sam Bankman-Fried Didn’t Spend Wisely During Midterm Elections

Sam Bankman-Fried, the disgraced former CEO of failed cryptocurrency exchange FTX, has another claim to fame. He was the Democrat’s second-largest individual donor in 2022, behind George Soros, according to OpenSecrets data. Nonetheless, Democrats may not miss much of his philanthropy now that his fortune is gone.

Bankman-Fried pledged in May to donate up to $1 billion to Democrats by 2024, but later retracted those comments, telling Politico they were “absurd.” Now, amid recent revelations about FTX’s incredibly messy balance sheet, he was once thought to be worth $16 billion as he filed for Chapter 11 bankruptcy. It is unclear whether he made such a statement because he could not afford to donate more. .

According to OpenSecrets data, Bankman-Fried’s actual giving to Democrats in the 2022 cycle totaled about $36 million, part of the original pledge. These donations were mostly made during the primaries, and his donations seemingly stopped around his June. He said the reason for the donation was to advance pandemic prevention, but he also donated to his conservative-leaning PAC, which supports cryptocurrency interests.

This includes the Alabama Conservative Fund, which backed Republican Katie Britt, whose campaign accepted donations in cryptocurrencies. Boozman co-authored a bill aimed at bringing the cryptocurrency market under the jurisdiction of the Commodity Futures Trading Commission. (In the aftermath of the FTX collapse, senators said the bill’s wording needed to be revisited.)

However, most of Bankman-Fried’s donation went to Protect Our Future PAC, which supports 25 candidates focused on pandemic prevention this year. Most have won races so far. Among those candidates are Rep. Abigail Spanberger (D-VA), who won a tough reelection campaign in her first precinct, and Maxwell Frost, who will represent Florida as her first Gen Z congressman. There was

But much of those “protect our future” funds went to a single Democratic primary in Oregon’s highly competitive House district, where the Democrats narrowly won a hard-fought battle for seats. In other words, Bankman-Fried, despite investing millions of dollars, had little impact on the Democratic Party’s overall midterm performance. That’s it.

Bankman-Fried’s downfall isn’t a tragedy for Democrats

Bankman-Fried is a major contributor to Protect Our Future, and the PAC spent much of its $11 million-plus fund to advance Democratic Party Carrick Flynn and his primary opponent in Oregon’s Sixth District. It subdued state legislator Andrea Salinas. This surpasses his $5.2 million his Bankman-Fried spent in support of Joe Biden in 2020, making the former New York City mayor his second-largest individual donor after Michael Bloomberg. I’m here.

Other Democratic groups to which Bankman-Fried donated, such as the House Majority PAC, also endorsed Flynn in the primary. This sparked outrage from all Democratic candidates in the campaign, who released a joint statement in April saying they “slapped all Democratic voters and volunteers in Oregon.”

Flynn’s resume provides clues as to why Bankman-Fried sought to invest so much in him. For years, Flynn has been an organization seeking to prevent potential threats posed by artificial intelligence, a major focus of Effective Altruism, a movement focused on optimizing charitable giving. I worked at Bankman-Fried, one of the movement’s most high-profile supporters, has now suffered its disservice. Flynn later worked on creating policies to combat Covid-19. When he spoke with Vox about his candidacy, Flynn said one of Bankman-Fried’s biggest problems was his “first priority is pandemic prevention.” (Disclosure: Future Perfect, Vox’s effective altruism-inspired vertical, received a grant in 2022 from Bankman-Frieds’ family foundation, Building a Stronger Future.)

In the end, Flynn lost the primary by a double-digit margin, despite Protect Our Future’s investment in Flynn making it the fifth-most expensive House race of the year. Before Election Day, the Cook Political Report rated the newly created seats during the reorganization a toss-up. It took almost a week for the Associated Press to call for a campaign, and in the end, Salinas edged Republican candidate Mike Erickson by just over two points.

This raises the question whether Bankman-Fried was wasting his money despite his obsession with the validity of donations. These funds, for example, may have helped candidates in New York whose Democratic defeat may have cost them party control of the House.

In fact, the roughly $1 million that Protect Our Future spent attacking Salinas during the primary may have made the general election more competitive than it otherwise would have been. PAC posted his Facebook ad in May that called Salinas a “corporate lobbyist accused of driving up drug prices,” even though Salinas voted in the state capitol on a bill to lower drug prices. .

Perhaps in future cycles, Bankman-Fried would have donated differently. But based on the results of this cycle, it’s possible Democrats won’t necessarily overlook Bankman-Fried’s fortune, which went to zero in a matter of days. Some, including Sen. Kirsten Gillibrand (D-New York), Sen. Dick Durbin (D-Illinois) and Rep. Chui Garcia (D-Illinois), have already received unpaid money from Bankman. We are committed to donating used campaign funds. Fry for charity.

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