Fighting for Pro-Crypto Legislation in Sam Bankman-Fried's Shadow (with Chris Lehane)

Chris Lehane was once the consummate Democratic spin man and campaign wonk. He introduced the world to the vast right-wing conspiracy against the Clintons.

In 2015, Lehane dove into the high-growth startup world. He joined Airbnb to run policy and communications. He taught the home sharing company how to fight nicely with cities, dishing out data and tax cooperation in exchange for favorable local regulations. Unlike Uber’s confrontational approach that had it going to war with Bill de Blasio in New York City, Airbnb tried to foster a cozy relationship with urban policymakers.¹Airbnb CEO Brian Chesky and President Barack Obama built a tight relationship.

A year ago, just as the crypto winter was starting, Lehane joined Katie Haun’s self-named venture fund, which had raised $1.5 billion. Haun Ventures positioned itself as a leader in regulation, policy, and communications. Haun is a former assistant U.S. attorney. Rachael Horwitz, the firm’s chief marketing officer, once ran communications for Coinbase. And Lehane brought the political experience, especially with Democrats.

But there’s only so much one firm can do to change crypto’s reputation in Washington, especially with Democrats. Sam Bankman-Fried, the former CEO of FTX, had become the crypto world’s standard bearer with Democrats, donating to their campaigns and speaking to their values. Then when Bankman-Fried’s empire unraveled and he headed to jail, many Democrats grew disillusioned with crypto.

This year, two Republican-led House committees moved forward crypto-friendly legislation that would clarify the regulation of crypto currencies and give the Commodities Futures Trading Commission more power to regulate crypto (denying the SEC some of that power). Meanwhile, the Biden appointed SEC chair Gary Gensler has sued crypto exchange Coinbase and Binance for failing to register their exchanges with the SEC.

I invited Lehane on the Newcomer podcast to take stock of crypto’s status in Washington. We talked about the bills working their way through Congress, the SEC lawsuits, and the crypto winter. Lehane and I also talked about how he believed that America needed to embrace a “common sector” that served as a hybrid between government regulation and corporate self-regulation. Think Airbnb data sharing with cities or Facebook’s oversight board. We also commiserated over co-existing with Silicon Valley Republicans in the MAGA era.

1. That strategy hasn’t stopped New York City from banning many Airbnbs this year.