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The State of New York

What Does Big Crypto Want From Governor Hochul and Her Running Mate?

The legislature moved to cut down on crypto mining in the state. Now investors may be bracing for an existential battle.

3:22 PM EDT on June 7, 2022

(Antonio Delgado Instagram)

Governor Kathy Hochul has run a steady and seemingly unstoppable campaign to win the upcoming Democratic primary election, racking up most of the major endorsements and amassing more than $10 million in campaign funds. Not even a backroom deal to give hundreds of millions of dollars to wealthy NFL team owners could slow her roll. But choosing a running mate has been trickier.

Her original pick, former Assemblyman Brian Benjamin, who was supposed to bolster her standing downstate, was charged in April for bribery and resigned soon after.

Hochul then tapped Congressman Antonio Delgado, which prompted anger from fellow Democrats, who pointed out that the governor was removing a proven winner from an upstate swing district and inserting them in the largely ceremonial role of lieutenant governor. (Hochul and David Patterson are living examples two times in the past fifteen years that they have then become governor).

Delgado is facing a serious challenge from Working Families Party candidate Ana Maria Archila, who has been in the race much longer.

So what could put Delgado over the top? Maybe crypto investors! Yesterday, Politico reported that the Protect Our Future PAC, which is primarily funded by Sam Bankman-Fried, 30-year-old founder of the crypto exchange FTX, has begun spending on Delgado in the final weeks before election day. A New York-based arm of the PAC has committed $1 million to spend in New York races; according to the Albany Times Union, Delgado is the only candidate the PAC plans to support in the state.

This comes after cryptocurrency investors were served a blow last week by the state legislature, with the last-minute passage of a bill that would temporarily ban new “proof of work” cryptocurrency mining operations that run off of fossil fuel plants. (Not many cryptocurrency miners have gone this route in New York, but the prospect of regulation has upset many of the currency’s backers in the state).

That ban (which is irritating to the crypto industry not merely because it would impact mining operations, but because it represents the idea that they should be subject to regulations at all) now sits on Governor Hochul’s desk, ready for passage. Except Hochul, who has accepted $40,000 from the CEO of a company with a crypto mining company upstate, doesn’t appear to be in any rush to take action on it.

As for Delgado, where does he stand on the cryptocurrency industry, especially now that his campaign is being boosted by crypto interests? The candidate currently has no listed policy positions on his website. Hell Gate has reached out to the Delgado campaign for his position on the mining ban, but has not heard back.

A spokesperson for Protect Our Future, however, said the support was unrelated to any concessions for the cryptocurrency industry and that the group was launched "to help elect candidates who will be champions for pandemic prevention.”

Asked about the $40,000 donation from the crypto CEO, a spokesperson for Governor Hochul has stated, “Political donations have no influence on government decisions."

On Twitter, Archila demanded that Delgado call for Hochul to sign the moratorium. "The billionaires know who’s going to do their bidding in Albany. His name is Antonio Delgado, and they’re spending lavishly to elect him," she added.

Crypto campaign spending is likely to come up during Tuesday night's Democratic primary debate between Hochul, Congressman Tom Suozzi, and Archila's running mate, New York City Public Advocate Jumaane Williams.

Last week, the New York state Attorney General warned investors against investing in cryptocurrencies amidst a major collapse in the market, announcing that the speculative investment vehicle was "among the most high-risk investments on the market." New York City’s mayor, our governor, and one potential lieutenant governor, have decided to sidestep that advice…at least, while there are elections to win.

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