Senate Democrats are embroiled in a fight over crypto regulation. At issue is whether a pro-crypto faction should provide the decisive votes to pass the GENIUS Act, which, among other things, would allow President Trump to continue to use his own cryptocurrency as a conduit for corruption.

Some pro-crypto Dems will make the case for cryptocurrency on the merits, but they also have political motives: They want to get on the right side of the crypto lobby (or at least not invite its ire) and increase the party’s weak appeal to young male voters along the way. The other faction, led by Sen. Elizabeth Warren (D-MA), is highly skeptical of cryptocurrency in general, and would like it subject to much stricter regulation, but the immediate objective, and larger source of sway over pro-crypto Dems, has a political component, too: Oppose any new crypto regime that allows presidents to use so-called stablecoins as bribery funnels.

Cards on the table, I want Warren to win this fight. To some very small extent, that’s because I’m a crypto skeptic—even of stablecoins, which are at least pegged to the value of real assets—and I trust financial-regulatory experts like Warren to see around corners and reduce the risk of abuses and crises before they spiral out of control. But mostly it’s because I want Democrats to seize every sensible opportunity to draw attention to, and make Republicans pay a price for, abetting Trump’s corruption.

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Democrats understand the value and urgency of anticorruption politics when there are no special interests on Trump’s side.

Chuck Schumer announced this week that he’d serially filibuster all Justice Department nominees until Attorney General Pam Bondi answers questions about the $400 million airplane Trump intends to accept from Qatar. That’s a good first step, and a template for further action. If Trump says the Defense Department will take possession of the bribery plane, and spend hundreds of millions of taxpayer dollars to sweep it for surveillance equipment and reassemble it, then Democrats should extend their holds to Pentagon nominees. Introduce legislation to defund the entire boondoggle.

The crypto bill provides a similar opportunity to make Republicans reveal their priorities. Do they want to deliver the crypto industry a lax regulatory regime, or do they want to help Trump get away with high crimes?

It’s nice to think Democrats across the spectrum, from the most anti-crypto to the most pro, would see the higher values of rule of law, anti-corruption, and making Trump eat shit as guide stars. Speaking as one, they could tell the crypto world that the only thing standing between them and their money is Trump and his greed. And for a brief moment, they did. They filibustered the GENIUS Act on first pass, raising Trump’s self-enrichmentIas a core objection.

But I don’t think Warren will ultimately win this fight, and I don’t think she thinks she will. Instead, Republicans will go to extraordinary lengths to enable Trump’s corruption, several Democrats will decide that’s a price they’ll tolerate to clear the crypto bill, and the GENIUS Act will pass.

And to me, quite apart from Trump’s crypto scam specifically, or crypto generally, this raises some pretty profound questions about what different people mean when they say Democrats need to build a bigger tent, and how they go about enticing people to join.

TALES FROM THE CRYPTO

The best political case I’ve heard for standing down on crypto pertains to Democrats’ recent difficulties with young male voters. During the Biden presidency, the argument goes, SEC Chair Gary Gensler took aggressive enforcement action against crypto, and it basically cost Democrats the election. Too many young men had put too much dumb money into these questionable assets, and the industry became too big to fail, as a political matter. They were just going to vote for whoever promised to make their “investments” pay off.

And so, the logic goes that caving to crypto lobbyists is actually just caving to reality. If Democrats remain crypto scolds for high-minded reasons, they can brag about their moral purity from the wilderness forever, while Republicans destroy everything else they care about.

I’m not sure I buy this, but stipulating that it’s true, it definitely doesn’t follow that the optimal political approach is to make sweaty bedfellows with crypto magnates.

For one thing, it doesn’t take a genius to imagine this alliance blowing back. At one point or another, short-term thinking along these lines convinced subsets of Democrats to support both the Iraq war and Wall Street deregulation, and both of those turned out to be bad bets.

For another thing, crypto isn’t actually popular.

For a third thing, crying uncle over crypto, as if the proposition were binary, reflects a simplistic and reactive approach to political adversity, wherein the best move is always to cave. Democrats helped Republicans pass the Laken Riley bill on the same thinking, without giving due consideration to how the law would work in practice or hamstring their party in the future. That decision did not neutralize the immigration issue, but it will become the source of immense grief for the next Democratic president.

They should not try to neutralize the crypto issue in the same way.

Caving in this case won’t just create bad policy. It will sacrifice a rare opportunity for Democrats, from the minority, to check or increase the salience of Trump’s corruption. And it will drive Democrats into partnership with genuinely unworthy, low-character people, as we see when someone like Ruben Gallego cozies up to Marc Andreesen.

Democrats could instead appeal to young male crypto investors not with caveat emptor-style scolding, but by extending an olive branch to those who aren’t bought fully into the crypto scofflaw subculture. Not every crypto holder is a civic degenerate, or cool with Trump selling out America. It’s worth trying to make them see that Trump is the main obstacle to crypto regulation—that he won’t do any favors for crypto unless he’s allowed use it to sell policy to the highest bidders.

By contrast, it’s not worth wasting time or credibility trying to win over David Sacks and the Winklevoss twins.

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TENT, POLLS

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