Crypto PAC Fellowship Spends $3M Supporting Pro-Crypto Candidates, Mostly for Texas' Ken Paxton
Tether-linked political action committee backs Texas AG in Senate runoff against John Cornyn, while Kalshi bans candidate for betting on himself
Quick Look
- The crypto-aligned Fellowship PAC, led by Tether's head of government affairs, spent over $3 million on advertising for US Senate and House races, with $1.75 million supporting Texas Attorney General Ken Paxton in his May 26 runoff against Senator John Cornyn.
- Additional spending included $350,000 each for Mike Collins in Georgia and Barry Moore in Alabama, and $250,000 and $350,000 for Blake Miguez and Julia Letlow in Louisiana.
- Meanwhile, prediction market Kalshi banned Texas candidate Ezekiel Enriquez for five years after he bet less than $100 on his own candidacy.
AI-generated summary
Why It Matters
Crypto industry has become increasingly politically active, with major players like Tether and Fairshake spending hundreds of millions on campaign advertising. Fellowship PAC emerged in late 2024 claiming substantial funding from crypto-aligned investors. Ken Paxton, despite facing impeachment in 2023, remains a prominent Texas Republican figure in the Senate race.
The crypto-aligned Fellowship political action committee (PAC), led by stablecoin issuer Tether's head of government affairs, reported spending more than $3 million on advertising related to US Senate and House races, with the majority going toward to support a Texas Republican candidate. In a Tuesday filing with the US Federal Election Commission (FEC), Fellowship PAC disclosed that it had spent $1.75 million in support of Texas Attorney General Ken Paxton. The Republican is facing off against incumbent Senator John Cornyn in a May 26 runoff to determine who will become the party's candidate for the 2026 US Senate race. In addition to Paxton, the PAC reported spending $350,000 on advertising for Mike Collins in Georgia's Senate race, $350,000 on Barry Moore in Alabama's Senate race, and $250,000 and $350,000 on Blake Miguez and Julia Letlow, respectively, for House and Senate races in Louisiana. All expenditures went through the Nxum Group, a marketing company co-founded by former White House crypto adviser and Tether US CEO Bo Hines. Fellowship launched in September, claiming to have more than $100 million from undisclosed investors aligned with the crypto industry. Although the PAC has since reported $11 million in contributions to the FEC, no other filings or public records showed backers associated with crypto. Crypto-backed PACs like Fellowship and Fairshake are expected to influence the results of the 2026 US midterm elections through spending on media and advertising to support candidates they consider "pro-crypto." Fairshake and its affiliates reported spending more than $131 million in 2024, possibly influencing voters in key battleground states. Paxton's time as Texas Attorney General was plagued by corruption allegations, leading to his impeachment in the state's House of Representatives in 2023 — he was later acquitted by the Texas Senate. Either Paxton or Cornyn will likely face off against Democratic candidate James Talarico in November's US Senate election. On Wednesday, prediction markets platform Kalshi announced financial penalties and bans on three candidates in Minnesota, Texas and Virginia after they were found to have placed bets on their respective races. The Texas candidate, Ezekiel Enriquez, "purchased less than $100 worth of contracts related to his own candidacy" for Texas' 21st Congressional District, according to Kalshi. "Under the terms of the settlement, Kalshi suspended Enriquez from direct or indirect access to Kalshi for a period of 5 years and imposed a financial penalty of $784.20," said the company.
What to Watch
AI outlook — possibilities, not facts
Fellowship PAC will continue spending heavily through the 2026 midterm elections
Very likely · Within months
Kalshi will implement stricter verification for political candidate accounts
Likely · Within weeks
FEC may investigate Fellowship PAC donor disclosure
Possible · Within months
Open Questions
- Who are the undisclosed investors in Fellowship PAC?
- Will the FEC investigate the source of Fellowship's funding?
- How will Paxton vs Cornyn runoff affect crypto regulation stance in Texas Senate race?
