Ryan Selkis Goes to Washington

In public, Ryan Selkis is one of crypto’s loudest gadflies, regularly excoriating U.S. regulators for overreach, especially Securities and Exchange Commission Chair Gary Gensler, in social media tirades.

Behind the scenes, the founder and CEO of data and analytics provider Messari has spent the last two years building a political fundraising machine for the industry that’s gearing up to sway elections in 2024.

This profile is part of CoinDesk’s Most Influential 2023. For the full list, click here.

Selkis recently handed off this work to Fairshake, a political action committee (PAC). It wields a war chest of about $15 million, a person close to the situation said. (Numbers won’t be disclosed in federal filings until January.) Brian Armstrong, CEO of leading U.S. cryptocurrency exchange Coinbase, said in October he personally gave Fairshake $1 million and hoped the PAC could raise $50 million or more.

Fairshake has begun putting those funds to work; Politico reported in November that the PAC spent $1.2 million in recent months on television ads for House candidates.

For laying the groundwork for this political blitz, CoinDesk has named Selkis one of the 10 Most Influential people in crypto for 2023.

Time will tell how well the PAC achieves its goals of filling open House and Senate seats with pro-crypto candidates, re-electing crypto-friendly incumbents and unseating hostile ones. But in Selkis’ view, his combative public style has already been vindicated.

“In 2021, it seemed like I was crazy,” Selkis said in an interview in early November. “Now it’s common sentiment across the industry that Gensler is really not a good actor operating in good faith by any stretch.”

It has indeed been a humbling year for Gensler, whose SEC suffered setbacks in its court battles with crypto companies such as Ripple and Grayscale. Gensler has also come under scrutiny for cozy interactions with Sam Bankman-Fried during the heyday of FTX, years before that crypto exchange collapsed and its CEO was convicted on federal fraud charges.

It is also true that in 2021, Selkis did seem a little crazy – or, at least, hotheaded and impolitic.

Declaring ‘war’

In September of that year, near the height of the last bull market, Selkis posted on Twitter (now known as X) that he had decided to run for Senate and declared “war on our out-of-control regulatory state.”

The proximate trigger for his salvo was a subpoena the SEC had served the day before to a crypto executive about to walk onstage at Messari’s annual Mainnet conference in New York. (The subpoenaed party was later identified as Do Kwon, founder of the TerraUSD stablecoin that collapsed the following year, whom the SEC eventually charged with fraud, and who is now languishing in a Montenegrin prison while the U.S. and South Korea fight for his extradition.)

“If you’re wondering when I actually decided to run for Senate, it was when these f–kers came to my event, didn’t buy a ticket, and served one of the speakers a subpoena,” Selkis tweeted. “Enough talk. … Selkis 2024. Time to activate the crypto political machine.”

That evening, I received an anxious text from a crypto industry lawyer.

“Selkis is really doing damage,” this attorney, who had previously worked in the more genteel field of banking, told me. “He has been antagonizing Gensler … He is out of control, fanning fires unnecessarily.”

To Selkis, however, policymakers like Gensler and Sen. Elizabeth Warren (D-Mass.) never needed antagonizing; they had it in for crypto from the get-go.

“This year, we’ve seen just how one-sided the narrative is, and how punitive some policymakers are,” Selkis told me in November. “It’s not tinfoil-hat anymore to think that ‘they’re out to get us’ when someone like Elizabeth Warren is literally putting out campaign ads that say she’s raising money and building an anti-crypto army.”

The November 2022 collapse of FTX did the industry no favors in the public eye or in Washington, D.C. But Selkis argues last year’s crypto crash is not the only reason for a slew of aggressive enforcement actions from the SEC and antagonistic legislation like Warren’s bill, which would extend customer-identification requirements to miners and wallet providers.

“The opposition to crypto is more than just a reaction or overreaction to some of the fraud and bankruptcies from last year,” he said. “It’s much more philosophical. Crypto is just one issue that that radical anti-tech philosophy is going to impact.”

Selkis never ran for Senate (he told me he seriously considered it but had no shot in any of the states he could credibly run in). He still saw a need for a more muscular crypto presence in Washington than the handful of trade associations and think tanks that have represented the industry for the last decade or so.

“They’d have productive meetings with policymakers, and then that policymaker would more likely than not look at their watch and say, ‘Oh, this has been a great conversation, but I gotta jet early so that I can go to a fundraiser with the bankers’ association,'” Selkis said. “And that’s just kind of the reality of how D.C. operates.”

Most crypto executives, he said, were naive in underestimating the importance of political donations and vehicles like PACs. With one unfortunate exception.

‘Chaotic good’

Sam Bankman-Fried was a prolific political donor, showering politicians with tens of millions in campaign contributions before his FTX empire imploded in November 2022. During his heyday, he was often cast as a long-needed diplomat who, disheveled appearance notwithstanding, could hold constructive dialogue with Washington, unlike the anarchists and techbros long associated with crypto.

“The media and D.C. establishment – not the industry by any stretch – basically anointed him as our representative and it blew up in our face,” Selkis said.

Now facing decades in prison for misusing FTX customers’ funds, the former golden boy has become crypto’s greatest embarrassment, a title for which there is no shortage of competition.

For Selkis, the irony is delicious, particularly because Bankman-Fried had been aggressively lobbying for a bill that detractors said would have killed decentralized finance (DeFi) in the U.S. and entrenched centralized platforms like FTX.

“Some of the very worst folks that we’ve had to deal with as an industry and some of the folks that have since been sued for fraud, or have now been convicted in Sam’s case … they were seen as the ‘adults’ and it was because, of course, they didn’t fight,” Selkis said.

“They were trying to basically capture these folks in D.C. that would ultimately give them a pass or a monopoly,” he went on. “By currying favor and kissing ass, they were willing to sell basically anyone out, including their customers, in some cases. But they always said the nice things.”

Referring to the role-playing game Dungeons & Dragons, Selkis said he’d rather be “the chaotic good than the lawful evil.”

Swing voter’s issue?

Tweets aside, Selkis’ big splash as an aspiring political kingmaker was appearing on Fox News’ Tucker Carlson Tonight in February 2022. Appealing to the populist sensibilities of the host and audience, Selkis cast crypto as a check on Big Government, Big Banks and Big Tech, and contrasted decentralized systems like Bitcoin with the centralized digital currency created by the Chinese Communist Party.

He concluded by telling Carlson he had founded the Digital Freedom Alliance (DFA) to advance pro-crypto policies – and more importantly, to support pro-crypto candidates.

“This is going to be a swing voter’s issue, with 50 million Americans owning crypto, and quite a bit of single-issue voters, myself included, among that cohort,” Selkis predicted. “It’s a nonpartisan issue too, Tucker,” he added, just before the segment ended.

(The 50 million figure, which implies one in five U.S. adults own crypto, later appeared in a survey commissioned by Coinbase. Better Markets, an advocacy group, questioned the findings, noting that the 2,202 respondents included an oversample, or deliberate addition, of 500 crypto investors.)

When I spoke to Selkis in November, I asked if there were really enough single-issue crypto voters to make a difference – particularly now, after a brutal bear market. Even if there are 50 million American crypto holders, surely a nontrivial portion of them are underwater on their investments or have been burned by bankrupt exchanges and lenders.

He said the truly significant cohort was a subset of those with portfolios. “Maybe at best, it’s a wash, whether the number of people that own crypto helps or hurts us,” Selkis acknowledged. “But when you think about the folks who really have made crypto either their livelihood or just philosophically feel very strongly in favor of it,” there are enough to tip the balance in key races.

“Certain states are only won or lost by tens of thousands of votes,” he said. “So you don’t need to have 50 million people become single-issue voters. You only need a couple hundred thousand in the right areas.”

‘Outspent by pipe welders’

Selkis stressed to me he favors “common-sense regulation” and comprehensive bipartisan legislation that would promote healthy competition while protecting investors. Pretending crypto will never be regulated is “childish,” he said.

The lack of clear guardrails encouraged risk-taking in the last crypto bubble, Selkis argued. For example, the SEC’s reluctance to approve an exchange-traded fund (ETF) backed by bitcoin forced investors simply looking for BTC exposure to buy coins on offshore exchanges like FTX and Binance, he said.

By April 2023, Selkis was setting audacious goals for the DFA, tweeting that he would raise $100 million. An article in Barron’s noted this would have been more than the powerful National Association of Realtors spent lobbying Congress in 2022.

In October, when he appeared with Coinbase’s Armstrong at Mainnet 2023, Selkis sounded humbler in his ambitions, saying crypto first needed to catch up with established industries in political spending.

“These super PACs in other industries can raise $50 million, $100 million,” he said. “I mean, we’re getting outspent by like the f**king pipe welders of Ohio right now.” (Not as hyperbolic as it sounds: Building trade union PACs as a group gave $13.5 million to candidates during the 2022 election cycle, according to OpenSecrets.)

Selkis declared from the outset of his campaign that he didn’t want to go into politics full-time. Building Messari, the data and analytics company he started in 2018 with head of engineering Diran Li and chief revenue officer Eric Turner, would always be the first priority. A funding round last fall valued the firm at $300 million.

By the time he spoke at Mainnet in October, Selkis had handed over most fundraising work to Michael Carcaise, a political operative whose GMI PAC spent about $12 million in the 2022 election cycle supporting pro-tech candidates in general and has begun to support pro-crypto candidates through Fairshake.

“Mike and his team did a great job picking the districts, picking the seats, last time around, that they were going to go after and try to support candidates on an early basis,” Selkis told Armstrong. Of the 23 candidates indirectly backed by Carcaise’s GMI (through his Web3 Forward and Crypto Innovation PACs) last year, 19 won general elections and three lost primaries, according to public data compiled by OpenSecrets. (One more fell just short of winning a primary with 49% of the vote, then dropped out of the runoff after an infidelity scandal.)

Although he’s handed Carcaise the reins, don’t expect Selkis to hold his tongue on policy matters. Another reason he is so outspoken, he said, is that as an information provider, Messari has less to lose than a regulated financial services company living in fear of enforcement actions.

“I can say things others can’t,” Selkis said.