The Crypto Scandal Is Also an Opportunity for the Left

Sam Bankman-Fried's downfall can help fuel a new war on plutocratic donors.

The Crypto Scandal Is Also an Opportunity for the Left

Sam Bankman-Fried is the founder of FTX. He is escorted from the Magistrate's Court, Nassau, Bahamas on December 13, 2022. (George Robinson via Bloomberg via Getty).

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Sam Bankman-Fried was able to conceal his fraud empire by using the cover of philanthropy. The ideology of effective altruism was used to justify his once-immensive fortune, which was recently estimated at more than $26 billion. This fortune, which was always speculative and largely imagined, is gone. FTX, a crypto exchange based in the Bahamas, was bankrupted by Bankman-Fried. Bankman-Fried is also facing criminal charges in the United States and Bahamas for fraud. It is possible that Sam Bankman Fried turns out to actually be a philanthropist. He is currently in jail for his business activities but has accidentally shined a powerful spotlight on the corrupt world of the donor class. Bankman-Fried, who donated more than $40 million to the Democratic Party during the 2022 election cycle was the second largest donor. FTX, like many other businesses, tried to spread donations among both major parties to maximize influence and access. Last month, I wrote about the crypto problem that the Democrats face. The law firm is Elias Law Group. It was founded in 2021 by Marc E. Elias, a Democratic party bigwig. It is important to clarify that none of the politicians who received money from Bankman Fried and other FTX executives were charged with crimes. They were merely accused of poor judgment when they took money from dubious sources. If Bankman-Fried is convicted of fraud, there will be great social pressure to reimburse the donations to his victims, including FTX shareholders. Bankman-Fried could be charged with not only running a Ponzi scheme, but also violating campaign finance laws. This will increase the pressure on Bankman-Fried to return the money. Bankman-Fried breaking campaign finance laws will bring back the issue of big money in politics. Bernie Sanders' 2016 campaign to become the Democratic Party's presidential candidate was successful. He highlighted the importance of wealthy donors and demanded that his campaign only be funded by small donations. Other progressives, including Representative Alexandria Ocasio Cortez, have adopted the Sanders model of small-donor funding. It is important to remember that Bankman-Fried's story does not only concern fraud in cryptocurrency. It also involves internecine conflict within the Democratic Party. Bankman-Fried was a financier for the counterrevolution against the insurgency. Bankman-Fried funded progressive candidates, such as Maxwell Frost, the newly elected Florida Representative. This was part of a general donor strategy to spread wealth around to ensure maximum accessibility. The United Democracy Project, AIPAC’s Super PAC spent more than $2 million on mailers, advertisements, and other materials supporting Valerie Foushee. Allam's main opposition in the Democratic primaries. These groups can spend unlimited amounts of money in support or against candidates, but they are prohibited from coordinating with candidates. Foushee received $460,000 more from AIPAC's political committee (PAC), which accounted for 39% of Foushee’s total fundraising. Kane's reporting reveals that Bankman-Fried doesn't have to be the only donor supporting the counterrevolution against left wing primary candidates. The umbrella organization AIPAC is leading the charge. This is a problem for established Democrats, but also a chance for the left. Bankman-Fried's erratic rise and fall, his ability quickly to gain political influence, and his eagerness and willingness to get involved in a project that would drown out small-donor funding for progressive candidates are all lessons. Bankman-Fried should be portrayed as the embodiment of corruption in politics by the donor class. The left can then use his downfall as an opportunity to challenge the establishment, which was eager to work alongside the discredited plutocrat.