In early 2022, the crypto industry was riding high, and FTX’s policy official Mark Wetjen emailed the Federal Reserve chair Jerome H. Powell requesting a meeting with Sam Bankman-Fried, the founder of the cryptocurrency exchange. Mr. Powell agreed to the meeting on February 1st, and Mr. Wetjen sent him two policy papers his company had published. Mr. Bankman-Fried also managed to score a virtual meeting with Lael Brainard, the director of the White House National Economic Council, and another meeting with the head of the Federal Deposit Insurance Corporation.
Since FTX’s collapse, the crypto industry has encountered more difficulties in Washington. Many congressional offices have become reluctant to meet with industry representatives, and crypto lobbyists have had to shift their strategy in order to distance themselves from FTX. To counter this, the nonprofit Stand With Crypto is holding a “fly-in” to talk with lawmakers.
Despite the more hostile environment, the industry has not stopped pouring money into lobbying. Mr. Powell had a private-sector meeting with a Stripe representative in March 2022, but he has not listed similar meetings since. At his meeting with Mr. Bankman-Fried, the two discussed stablecoins and central bank digital currencies.
FTX’s influence extended beyond the Fed, as Mr. Wetjen had connections with many regulatory officials from his earlier policy role. He and Mr. Powell had previously worked together, and Mr. Wetjen managed to gain access to a range of federal officials. The company also flooded Washington with money, which helped it gain a foothold in congressional offices and at think tanks.
The crypto industry is now striving to change the public’s perception of them, and with Mr. Bankman-Fried’s trial starting, they are doing their best to move away from FTX. Money may be talking, but the industry must now work harder to gain access to the halls of power.
