The Senate Democrats enabling Trump's crypto windfall

President Trump is shamelessly exploiting the presidency for personal profit. At the center of this effort is a variety of crypto ventures. For example, Trump recently gifted a VIP tour of the White House to the largest purchasers of his crypto meme coin, $TRUMP. The average winner bought about $4.3 million worth of Trump meme coins.

USD1, a "stablecoin" recently created by the Trump-backed crypto firm World Liberty Financial, may eventually offer Trump an even bigger payday. Stablecoins are cryptocurrencies whose value is pegged to traditional assets. In the case of USD1, each coin is backed by one American dollar.

Why would someone want to use a stablecoin instead of an actual dollar? There is a lot of talk about "the future of finance," "innovation," and "decentralization." It is unclear exactly what that means, but today, stablecoins are frequently used for money laundering, scams, sanctions evasion, and other illicit activities.

USD1, which launched in March, offers another advantage: it serves as a vehicle for currying favor with the President of the United States. World Liberty Financial, which is majority owned by the Trump family, earns fees every time USD1 is used. Trump and his family also profit from interest earned on the dollars held as USD1's backing.

This is not a theoretical concern. MGX, an investment firm owned by the government of the United Arab Emirates, used USD1 to make a $2 billion investment in the crypto trading platform Binance.

This could be just the beginning.

The Senate is considering the GENIUS Act, which would provide an official regulatory framework for stablecoins. The passage of the GENIUS Act would legitimize and mainstream stablecoins. According to one industry analyst, if the GENIUS Act passes, the stablecoin industry could rise from $230 billion today to $2 trillion in 2028.

Trump is poised to be one of the primary beneficiaries of that expansion because, although it only launched in March, USD1 is already the fifth-largest stablecoin.

But the GENIUS Act required Democratic support in the Senate to pass because it is subject to the filibuster. On May 8, Democrats unanimously blocked a cloture vote, with many demanding provisions to curtail Trump's corruption.

After the failed May 8 vote, some tweaks to the bill were made, but nothing related to Trump's involvement in the stablecoin industry. Nevertheless, on May 19, 16 Democrats switched positions and voted to advance the legislation.

Some Democrats argued the bill was necessary to crack down on illegal activity. Senator Adam Schiff (D-CA), for example, said he voted for the GENIUS Act because "regulators and law enforcement need tools and guardrails to crack down on bad actors and illicit financing." The GENIUS Act does say that stablecoin issuers are subject to anti-money laundering provisions of U.S. law. But stablecoins were already subject to anti-money laundering laws. The issue is not the law, but enforcement, and the GENIUS Act does not provide any additional resources for enforcement.

Senator Mark Warner (D-VA) said he voted for the bill because it "limits big tech overreach." But the bill explicitly allows publicly traded non-financial companies, including tech companies, to issue stablecoins provided certain "criteria regarding financial risk, consumer data privacy, and fair business practices." Big Tech can also easily evade some of these requirements by obtaining their customers' "consent" through changes to their terms of service.

The bill still must clear a few hurdles before it makes its way to Trump's desk. First, it needs to obtain final passage in the Senate by a simple majority vote. It also needs the approval of the House, where Republicans hold only a narrow majority.

The GENIUS Act, however, has already passed its most difficult test. If things proceed as expected, it will be signed into law by Trump in the weeks ahead.

Which raises an important question: Why are Senate Democrats providing Trump an opportunity to make his corrupt crypto scheme even more profitable?

Follow the money

Several of the Democrats who voted to advance the GENIUS Act have received substantial financial support from the crypto industry, according to data collected by Follow the Crypto and Popular Information.

Fairshake, a super PAC funded by the crypto industry, spent over $10 million supporting the campaign of Senator Ruben Gallego (D-AZ). Gallego also received an additional $16,500 in direct contributions from individuals in the crypto industry, including $3,300 from Brian Armstrong, the CEO of Coinbase, and $3,300 from Ben Horowitz, the co-founder of venture capital firm Andreessen Horowitz. Rolling Stone reported Gallego charged $5,000 for access to a fundraising retreat that featured Marc Andreessen, co-founder of Andreessen Horowitz, as a speaker in March.

Fairshake spent another $10 million in support of Senator Elissa Slotkin (D-MI) in the 2024 cycle.

Since the 2020 election cycle, Schiff has received nearly $80,200 in total from individuals in the crypto industry, including $3,300 from Armstrong and $3,300 from Horowitz. Fairshake also spent $10 million attacking Katie Porter, one of Schiff's opponents in the 2024 Senate primary and a critic of the crypto industry.

Since the 2020 election cycle, Senator Kirsten Gillibrand (D-NY) has received over $180,000 from individuals in the crypto industry. This includes $21,600 from Stuart Alderoty and $21,600 from Chris Larsen, two executives at cryptocurrency company Ripple. Senator Martin Heinrich (D-NM) received $17,500 during the 2024 election cycle from crypto company PACs and individuals in the crypto industry, including $9,900 from Avichal Garg, co-founder of venture capital firm Electric Capital Partners.

Even Democrats without financial ties to crypto may be concerned about the industry's impact on future elections.

In the 2024 cycle, the crypto industry spent vast sums to push pro-crypto candidates over the finish line. The industry spent over $200 million across dozens of races in 2024. Fairshake alone saw 53 of the 58 candidates that it financially supported win their races — meaning that about 1 in 10 members of Congress are tied to the crypto PAC.

Industry leaders have shown no intentions of slowing down. When the 2024 election came to a close, Fairshake already had $78 million earmarked for the 2026 midterms. By the end of January, they had $116 million in their arsenal.

As the crypto industry's political budget balloons, it appears to be winning over some previously skeptical Democrats. One of the 16 Senate Democrats who helped the GENIUS Act advance was Catherine Cortez Masto of Nevada. As recently as February, Cortez Masto was rated by Stand With Crypto, an industry group that rates politicians on their crypto-friendliness, at an “F” for being “strongly against crypto,” as she had cosponsored a bill to crack down on money-laundering in crypto. After her most recent crypto vote, she is now rated at an “A” for “strongly supports crypto.”