AI and Crypto’s Election Spending Spree Backfired Spectacularly

Last night’s elections are estimated to be the most expensive midterms in U.S. history, and they ended in a massive blue wave with Democrats taking control of both the House and Senate. That’s bad news for the crypto and AI industries, which spent a fortune backing candidates who ended up losing. Crypto and AI companies poured hundreds of millions of dollars into this year’s elections in an effort to elect candidates friendly to their industries. While some of those bets paid off, many of their biggest ones didn’t. Crypto- and AI-focused super PACs spent $112 million supporting and opposing candidates in the general election alone, according to Tech Influence Watch. As of Wednesday morning, $74.7 million of that spending had gone toward losing candidates or efforts to defeat winning candidates. The losses came despite an influx of money from Silicon Valley into this year’s elections. Overall, crypto and AI companies and employees contributed more than $506 million to political committees this election cycle, according to Tech Influence Watch’s estimates. Meanwhile, industry-focused PACs spent nearly $250 million on federal elections, including primaries. More specifically, AI-focused super PACs spent $72.3 million on this year’s elections, including nearly $28 million from groups pushing for fewer AI regulations, according to Transformer’s AI Campaign Finance Tracker. Tech Influence Watch puts that figure closer to $79 million. Additionally, the crypto industry’s three largest super PACs, including Fairshake, spent roughly $170 million on congressional races, CoinDesk reported. Fairshake and its affiliates accounted for $154 million of that spending, a spokesperson told CoinDesk. Elon Musk was the biggest individual political donor of the election cycle, contributing more than $470 million to political groups. A significant portion of that money went toward supporting Republican Ken Paxton in Texas’s Senate race against Democrat James Talarico. But despite the massive financial backing, Paxton lost, with Talarico winning roughly 55% of the vote. And Texas wasn’t the only place where tech-backed candidates lost. In Ohio, Democrat Sherrod Brown won his Senate race against Republican Jon Husted. That’s despite crypto-focused super PACs Defend American Jobs and Digital Freedom Fund having spent more than $64 million supporting Husted or opposing Brown. The Elon Musk-backed Senate Leadership Fund also spent more than $95.6 million on the race, mostly trying to defeat Brown. Musk’s own America PAC spent another $9.7 million opposing Brown. Meanwhile, Republican Darline Graham, the sister of the late Sen. Lindsey Graham, lost her Senate race in South Carolina to Democrat Annie Andrews. AI-focused super PACs Building the Future and American Mission had poured more than $4.8 million into supporting her campaign. The Senate Leadership Fund also burned through $13 million in a failed attempt to defeat Andrews. In Maine, longtime Republican Sen. Susan Collins lost her reelection bid to Democrat Troy Jackson. The pro-AI Alliance for a Better Future super PAC had spent over $800,000 supporting her. She also benefited from $38.6 million in spending on the race from the Senate Leadership Fund and $2.3 million from the America PAC. Over in Michigan, Democrat Abdul El-Sayed defeated Republican Mike Rogers, who benefited from more than $1.9 million in spending by the crypto-focused First Principles Digital PAC and the Alliance for a Better Future. The Senate Leadership Fund and America PAC also spent $47 million and $9 million, respectively, on the race. Over in Michigan, Democrat Abdul El-Sayed defeated Republican Mike Rogers, who benefited from nearly $1.9 million in spending by the crypto-focused First Principles Digital PAC and the AI-focused Alliance for a Better Future across the primary and general elections. But it wasn’t all bad news for the AI and crypto industries. In Nebraska, Republican Sen. Pete Ricketts won reelection after the Defend American Jobs PAC spent $13.5 million opposing his independent challenger, Dan Osborn. Crypto and AI PACs also backed winning candidates in several less competitive races. Still, last night proved that money can’t buy every election.