In the final days of the hotly contested Democratic primary for a House seat in Texas, intense television ads have started running in Dallas supporting state Rep. Julie Johnson, one of the top two candidates.
“Democrat Julie Johnson is a trailblazer in Texas,” the ad's narrator says, citing Johnson's record on gun reform and abortion rights, her support from leaders like Beto O'Rourke, and the fact that she is a Texas trailblazer. He touted his potential to become the state's first openly gay lawmaker. South.
The ad was paid for by Protect Progress, a super PAC backed by big names in the crypto industry, which spent nearly $1 million to air the spot this week ahead of Tuesday's primary election, according to federal campaign finance records. spent.
The late investment could be crucial for Johnson, who is in a tight race for the top spot in the primary against Brian Williams, a prominent Dallas trauma surgeon.
But it was no coincidence that super PACs moved to back Johnson. This comes as Johnson added language to her campaign website stating her support for cryptocurrencies and her desire to see Congress pass legislation to promote “cryptocurrency innovation.” That was later.
Johnson's website's “Issues” page now has a section dedicated to “innovations,” much of which focuses on cryptocurrencies.
“Blockchain technology and its applications will usher in the next generation of the Internet, enabling Americans to own their data, build wealth, and become stakeholders in the digital space of the future,” the page reads. The division is written. “Americans can benefit from innovation in cryptocurrencies. We will build technology that benefits ordinary Americans while protecting consumers and ensuring fair outcomes for all.” We need to establish clear rules for the cryptocurrency industry.”
“As a member of Congress, I will work to ensure that America has a regulatory framework in place that protects consumers and ensures that no American is left behind, while allowing American values to determine the future of the global financial system. ” he continued.
The language did not exist on Johnson's campaign website before February, according to a version of the website available at the Internet Archive. Because these archives are limited, it is unclear when this section was added, or if it was added along with entire positions from other issues that did not appear before February.
But the basic situation is clear. Johnson received a decisive boost in the final stages of a close election when he added language about politically powerful and active industries.
“Any campaign is a living structure,” Johnson campaign spokeswoman Chelsea Roe said in response to questions from The Daily Beast.
“We update our website regularly with new messages of support, pushback, and positions,” she said, responding to allegations of “Trump-style disinformation” from her opponent, Williams. He added that he had to respond. (Johnson's campaign has complained about Williams' characterization of her legislative history on guns.)
Elsewhere on her site, there is further evidence that Johnson, who before this month did not appear to have strong opinions on cryptocurrencies, was seeking help from this particular special interest. be. Although it is illegal for a candidate and a super PAC to coordinate directly, a candidate can circumvent these rules by using the publishing page of her website to announce relevant positions.
But there's a more controversial tactic that candidates sometimes use to tell super PACs the specific content they want used in their ads. Their website pages display text (outlined in red) containing things the campaign says “voters should know.”
Johnson uses a tactic known as “redboxing” on his site. There, her campaign outlines aspects of her biography and record that it wants to highlight in paid external advertising. Protect Progress made several of these points in its advertisement. Also included within the Redbox is Johnson's campaign language on cryptocurrencies, making it the clearest call for the industry to advertise in support of her.
Campaign finance watchdog groups argue that redboxing would be detrimental to democracy and completely undermine the principles outlined in the bill. citizens united The decision that campaigns and super PACs cannot legally coordinate. But the Federal Election Commission, which enforces these rules, has effectively left them alone.
If Johnson wins the primary, it could send a powerful message to other candidates looking to gain an edge in the 2024 race.
In December 2023, FairShake, a super PAC that is an affiliated parent company of Protect Progress, announced that it would “support leaders who support innovation and responsible regulation of U.S. cryptocurrencies and blockchain in the upcoming 2024 election.” said.
“We're supporting Julie because she's a legislator who gets things done, protects American consumers, and protects America,” FairShake spokesperson Josh Brust told The Daily Beast. “This is because we intend to steer towards responsible regulation in order to preserve jobs.” At home, where they belong. ”
“The day Congress fails to act, the day will come when crypto jobs and wealth will leave the country and fraudsters and criminals will be able to exploit the system,” Brust said.
In today's electoral politics, if not in the financial realm, there are few bets better than cryptocurrencies. In 2022, vastly resourced super PACs that have raised money in cryptocurrencies have spent lavishly on several Democratic Congressional primaries that could have a decisive impact.
Protect Our Future PAC, funded by disgraced FTX founder Sam Bankman Fried and his associates, has launched at least 100 TV ads to boost candidates in six safe Democratic primaries. Spent a million dollars. Five of the candidates they supported won. Others were more vocal about cryptocurrencies. Others didn't mention this issue at all.
The content of Johnson's site's encryption policy raises further questions. Much of the language on Mr. Johnson's website is the language used on the website of another candidate, Evan Lowe, a progressive Democrat running for a vacant seat in Congress based in Silicon Valley. matches word for word.
Lowe's website includes the same language used on Johnson's website: “Blockchain technology” that “ushers in the next generation of the internet.”
Both candidates are making exactly the same promise. “We will work to ensure that the United States has a regulatory framework in place that allows American values to determine the future of the global financial system, while protecting everyday consumers and ensuring that no American is left behind.” Back To. “
Notably, both Johnson and Lowe also stated that “in the 21st century, the United States, not countries like Russia or China, must lead the development of cryptocurrencies and blockchain technology.” ing.
Johnson's campaign did not respond to emailed questions about the source of the campaign's language regarding virtual currencies. A spokesperson for Mr. Lowe did not respond to a request for comment.
The hugely funded FTX unit has collapsed dramatically, leaving candidates to grapple with the issue of being backed by convicted criminals, but plans to influence the 2024 election There are still powerful crypto-currency interests that do not hide their intentions.
Axios reported in January that FairShake and two of its affiliates, Protect Progress and Defend American Jobs, had raised a total of $85 million for 2024 spending.
These PACs are already having a major impact on other races. FairShake spent $7 million on ads targeting cryptocurrency skeptic Rep. Katie Porter (D-Calif.), a front-runner for California's vacant Senate seat, also in Tuesday's election. spent.
Mr. Johnson is competing with Rep. Colin Allred (D-Texas), who is hoping to win his primary in Tuesday's primary to take on Sen. Ted Cruz (R-Texas) in the November election. He is competing to become the successor to the state of Texas. The district, based in north and east Dallas, is safely Democratic. Allred won re-election in 2022 by more than 30 points.
There is not much ideological clarity between Johnson and her arch-rival Williams. Mr Johnson is the campaign's top fundraiser and has the backing of the government. Dallas Morning News.
In a statement to the Daily Beast, Williams criticized crypto PAC spending on behalf of his opponent, and voters in the district should question what Johnson will do in government because of this support. said.
“It's disheartening to see special interests drop $1 million at the last minute to buy Julie Johnson's election,” he said. “This is exactly the type of politics I'm trying to change.”
