From YangDAO to Trump: The Incredible Political Upset of the Crypto Community

Author: Wang Chao, Empower Labs

In August 2019, an organization called YangDAO was announced, aiming to help the Chinese-American presidential candidate Andrew Yang participate in the election.

DAOs were once one of the most attractive innovations in the crypto space, but the first large-scale DAO in history encountered a catastrophic security flaw in 2016. The community was significantly impacted, and the DAO concept fell silent for a few years until Valentine's Day 2019, when a guy named Ameen Soleimani announced the return of DAOs with a 144-line core code at the Ethereum Denver conference.

This simple yet practical code was named the Moloch protocol, allowing people to create a DAO-style donation fund on Ethereum. It is said that people in ancient Canaan would sacrifice their firstborn to the gods in exchange for the safety of their entire tribe, and the accepting evil god was called Moloch. In 2014, scholar Scott Alexander published a famous article titled "Meditations on Moloch," explaining how humanity falls into the tragedy of the commons, thus giving Moloch a subtle meaning of public system failure.

Moloch was like a thunderclap, once again stirring people's longing for DAOs. By August of that year, more than 80 DAOs based on the Moloch protocol had emerged, and YangDAO was one of them.

Andrew Yang's two major campaign platforms—supporting cryptocurrency and promoting universal basic income—attracted crypto enthusiasts. YangDAO hoped to become a super PAC (independent political committee that can accept unlimited donations) supporting Andrew Yang. YangDAO claimed to be a 21st-century solution to 21st-century problems, particularly focusing on issues like unemployment caused by AI. However, due to poor promotion and the DAO concept not being widely understood, YangDAO only raised a few tens of thousands of dollars.

As Andrew Yang withdrew from the primary elections, YangDAO also came to an end. Although the history of YangDAO was brief, it was the first public and collective attempt by the crypto community to engage in American politics.

PACDAO

On August 20, 2021, PACDAO was established, aiming to influence congressional attitudes toward cryptocurrency through political lobbying, and even hoping to push a pro-crypto congressperson into Congress.

PACDAO showcased the rapid evolution in the DAO space. Compared to YangDAO two years earlier, it made significant progress in community organization, talent recruitment, fundraising, and project execution. The first fundraising utilized an NFT sale format and invited renowned political-themed artist Rebecca Hendin to design.

The most striking innovation of PACDAO was the establishment of an on-chain congressional scorecard. Community members could rate the crypto-friendliness of congresspersons, and the results would guide the political support direction of the crypto community. They also created mintable animated avatars for each political figure based on their scores.

However, politics remains a niche topic in the crypto space. I observed PACDAO for a long time, and although it was full of creative ideas, community engagement was not as high as other DAOs. After the midterm elections, PACDAO gradually ceased operations. Nevertheless, this attempt was still an important experiment in the crypto community's political participation.

ConstitutionDAO

In October 2021, Sotheby's announced the auction of the only circulating copy of the original U.S. Constitution. Less than ten days before the auction, a group of crypto enthusiasts came up with a bold idea on Twitter: to form a DAO to raise funds to purchase this Constitution.

This idea spread like wildfire, quickly igniting the entire crypto community. Within just a week, they accomplished what seemed impossible: gaining eligibility to bid at Sotheby's, negotiating to use cryptocurrency as collateral, establishing a compliant DAO structure, and handling various auction details. This initiative also attracted significant public attention, leading to coverage by several major media outlets.

Ultimately, ConstitutionDAO raised over $40 million in less than ten days, creating a miracle. Although they did not succeed in purchasing the Constitution copy, this action planted a seed in the hearts of millions of Americans. These seeds will eventually sprout, blossom, and bear fruit, gathering into a force that subtly changes the political ecology of the United States.

Lobby3

Back to Andrew Yang. Although YangDAO had no direct connection to him, this experience made him realize the potential of community power and the DAO organizational form.

At the 2022 Ethereum Denver conference, Andrew Yang announced the establishment of the Lobby3 project. The term "Lobby" in the name reflects the project's political nature. Lobby3 aims to merge traditional political lobbying with decentralized governance of DAOs, exploring new models for citizen participation in policy-making, and hopes to provide ordinary people with direct channels to influence politics.

However, Lobby3 has been more talk than action. Despite a lively start, subsequent operations have been lackluster. Andrew Yang clearly only devoted a small portion of his energy to Lobby3, with most of the work handled by a few enthusiastic community members. After organizing several lobbying activities in Washington, Lobby3 released its final proposal—the Sunset Plan—on August 20, 2023, marking the end of this political experiment.

Although this attempt did not last, it once again demonstrated the crypto community's ongoing exploration of political participation, providing valuable experience for future similar projects.

Standing with Crypto

DAOs are not the only groups in the crypto community participating in politics. In recent years, major crypto institutions in the U.S. have invested heavily in political lobbying, and these dispersed forces have ultimately consolidated into greater influence.

In 2023, an organization called Fairshake was born, a super PAC officially registered with the Federal Election Commission, backed by giants of the U.S. crypto industry. Coinbase, Ripple Labs, and A16z alone donated $45.5 million, $45 million, and $44 million, respectively. Fairshake's mission is clear: to support political candidates committed to making the U.S. a center for future internet innovation. They believe that to fully unleash the potential of an open blockchain economy in the U.S., it is crucial to create a clear and friendly regulatory and legal environment for innovators.

At the same time, another organization called Standing with Crypto was also established in 2023. If Fairshake is a high-end stage for crypto giants, Standing with Crypto represents an attempt to unite a broader community force. Its main initiator is still Coinbase, but the goal is to unite a wider range of industry practitioners and ordinary people, also attracting DAO organizations with distinct political stances like Devils DAO to join.

Standing with Crypto's strategy is quite creative; they almost copied PACDAO's approach by establishing a detailed scorecard for political figures' crypto positions. The database includes over a thousand political figures, allowing people to easily understand each congressperson's attitude toward cryptocurrency.

Each congressperson's data card also includes how they voted on past crypto-related proposals.

Furthermore, they carefully selected 24 candidates who are friendly to cryptocurrencies, actively guiding community members to endorse or donate to these candidates. This direct and powerful support method will undoubtedly have a significant impact on these candidates' electoral prospects.

Selected Candidates

With the strong support of industry giants, the power gathered by Standing with Crypto far exceeds any previous political participation by the crypto community.

Looking ahead to the 2024 congressional elections, we are likely to see several candidates supported by the crypto community successfully win seats. This new wave of political participation may become an important driving force for cryptocurrencies to enter mainstream society.

Trump and J.D. Vance

Four years ago, YangDAO's efforts in the presidential election stopped at the party primaries, but in this election, the crypto community has already entered the final round.

According to a survey conducted in the first half of this year, 19% of registered voters in the U.S. already hold cryptocurrencies, and another 16% plan to buy them. This large group has attracted significant attention from candidates. Trump expressed his pro-crypto stance early on, while Biden, who previously opposed cryptocurrencies, had to soften his attitude and start to make concessions.

In June of this year, under the guidance of Senator J.D. Vance, Silicon Valley investor David Sacks organized a fundraising dinner for Trump. Several figures from the crypto world attended, expressing their demands for relaxed regulations and encouragement of innovation to Trump. This dinner ultimately raised $12 million for Trump.

According to Axios, Elon Musk, former Fox News host Tucker Carlson, and David Sacks recently secretly lobbied Trump, recommending J.D. Vance as a vice-presidential candidate, with lobbying continuing until Monday morning. Ultimately, Trump did choose J.D. Vance as his running mate. This choice may have a direct connection to the crypto fundraising dinner organized by J.D. Vance.

Compared to Trump, J.D. Vance is a more radical supporter of cryptocurrencies. Since being elected senator in 2022, he has been one of the most active voices in Congress supporting cryptocurrencies. His 2022 financial disclosure showed that he held between $100,000 and $250,000 in Bitcoin through Coinbase and has held it ever since. In 2023, Vance also proposed a bill to protect crypto companies and exchanges from traditional bank blockades.

Vance once stated, "Our tech industry was characterized by innovative startups, but now it is dominated by boring monopolists. The crypto community stands in stark contrast to this shift."

In this context, the world may witness the emergence of a distinct pro-cryptocurrency U.S. presidential/vice-presidential combination this November. This potential outcome not only marks a significant enhancement of the political influence of the crypto community but may also bring far-reaching impacts on cryptocurrency policies in the U.S. and globally.

Looking back, these past events feel like a distant memory, yet upon reflection, the earliest sprouts began with the last presidential election, with most developments occurring in the last two to three years. In just a few short years, the political landscape in the U.S. has undergone tremendous changes. Such a rapid transformation may have even surprised the pioneers of political participation in the DAO space.

In retrospect, their efforts contributed to opening the doors of Capitol Hill to cryptocurrencies, but the greater credit should go to the ideals of cryptocurrencies themselves and their growing influence. These ideas, having been cultivated over more than a decade, have quietly changed public perception, and the widespread acceptance by the public has finally triggered a response from Washington politicians.

Once regarded as a fringe topic, cryptocurrencies have now become an issue that presidential candidates and congresspersons must take seriously. The utopian visions of the past are now becoming a reality before our eyes. This transformation is reshaping public understanding of finance, technology, and governance. The political participation of the crypto community has become an undeniable force for change, subtly shaping the future of the world.