Renowned crypto lending platform BlockFi has become the latest firm to hire lobbyists, Reuters reported on Friday. BlockFi has hired a five-person policy team from the law and lobbying firm Arnold & Porter Kaye Scholer LLP.
According to a federal lobbying disclosure this week, the team includes partner Mark Epley and legislative and public policy practice group chair Kevin O'Neill. As per the filing, the team will work on "regulatory and tax policy for financial service providers in digital assets."
Crypto has become a growing area for lobbying, with industry groups popping up to advocate digital currencies and related services. According to a March report from Public Citizen, the crypto industry spent over $9 million on lobbying in 2021 alone.
Arnold & Porter's partner Mark Epley stated that industry associations could play a crucial role in such efforts. It is especially true when speaking publicly about the industry's interests, but the policymakers want to hear it from individual players in the market.
According to Mark Epley, his firm can serve as BlockFi's alter ego, helping it discuss industry interests with the policymakers. Moreover, while Arnold & Porter have clients interested in crypto, it is currently not lobbying for any other crypto firm.
Increasing Efforts To Be On The Same Page With Policymakers
A BlockFi spokesperson stated that the firm is "eager to engage" with policymakers to help define the regulatory and tax environment for crypto. "BlockFi believes that key to the success of the industry is appropriate regulation," the spokesperson added.
In February, BlockFi agreed to pay $100 million to the U.S Securities Exchange Commission (SEC) and 32 states. It resulted from violating rules by offering an interest-bearing lending product without registering it with regulators. In fact, the fine set the record of being the highest penalty ever paid by a crypto firm.
However, the firm has neither accepted nor denied the SEC's findings. At that time, BlockFi called the settlement an example of its "pioneering efforts in securing regulatory clarity for the broader industry and our clients."
Meanwhile, BlockFi isn't the only crypto firm involved in lobbying. Digital currency exchange Coinbase has hired lobbyists from Wilmer Cutler Pickering Hale and Dorr and Steptoe & Johnson. Also, both the firms have reported no lobbying activity for the company during 2022's first quarter.
Previously, Coinbase hired Mayer Brown. However, according to a filing last month, that relationship ended in October 2022. Other crypto firms involved in lobbying include Coinbase, Ripple Labs, Blockchain Association, Stellar Development, Chamber of Digital Commerce, and Coinflip.