From Astral Codex Ten “Tech PACs Are Closing In On The Almonds:”
In 2019, Scott Alexander posed an interesting question, “Why do wealthy donors and other special interest groups spend relatively little on affecting election outcomes, when there is so much more potentially at stake?”
In my 2019 post Too Much Dark Money In Almonds, I asked: why is there so little money in politics?
During the 2018 election, Americans – candidates, parties, PACs, and small donors like you – spent a combined $5 billion pushing their preferred candidates. Although that sounds like a lot of money, Americans spent $12 billion on almonds that same year. Why the imbalance? The oil industry has strong political opinions, and they make $500 billion per year. Do they really think electing oil-friendly politicians isn’t worth 2% of revenue?
My explanation is that, true, $5 billion not much money relatively speaking compared to the potential stakes or other spending, such as almonds, but donating is no assurance of success. Policy success depends on many variables, most of which are outside of the donor’s control. First, the candidate has to win. And then actually implement said policy, which may require legislation, which again introduces more uncertainty.
Yes, if donating assured the desired outcome, it would be irrational to not donate much more. But it doesn’t. You’re only hoping that maybe the politician considers your donation when forming policy, with no guarantees. Thus, the expected value is much smaller. The expected value is the probability of said policy being ratified conditional on the candidate winning, which is small, multiplied by the potential windfall, which is big, so you get a largish number, but less than almonds.
Scott goes on to explain how Marc Andreessen’s new ‘crypto PAC’, Fairshake, bucked the trend by donating an unprecedented $260 million for pro-crypto candidates:
Anyway, they won overwhelmingly. They combined the business-as-usual strategy of donating to safe incumbents and both sides of close races, with the AIPAC strategy of picking a few big opponents of their cause and airdropping massive sums on their rivals. For example, Representative Katie Porter (D-California) was an Elizabeth Warren ally and cryptocurrency critic. When she ran for Senate, Fairshake dropped $10 million into attack ads against her in the primaries – more than most candidates’ total spending.
Scott shows a chart of Bitcoin’s strong performance since the 2024 election, seemingly validating Andreessen’s gamble. So a huge success? Case closed? Not so fast.
First, the S&P 500 and nasdaq are up a lot since Trump won. So to measure any outsized windfall effects attributable to Trump’s win, you’d have to control for the backdrop of a strong bull market. As of November 5th, Bitcoin is up 64% from $69k to $113k. But the QQQ is up 25%.
Also, it’s far too soon to say it was a success, or that, in his words, “it worked”. For one, there is no evidence Trump has made any progress on implementing the anticipated ‘Bitcoin reserve’, which would require legislation as I explain here. (Trump, to his credit, never actually promised it.) Instead, he only signed an executive order for the “Establishment of the Strategic Bitcoin Reserve and United States Digital Asset Stockpile,” but there is no evidence that it has actually been funded. So after nearly a near, basically no progress.
Trump hardly even mentions the reserve or the stockpile. He talks about everything but Bitcoin, but he’s perfectly fine lending his name to dubious crypto projects that have collectively cost his followers many millions of dollars. Trump’s two major endorsed cryptocurrencies, $TRUMP and $WLFI, are down between 50%-90%, respectively, depending on the timeframe.
Worse still, on August 14th, 2025, during a CNBC appearance Treasury Secretary Scott Bessent, affirmed, in no uncertain terms, that the Bitcoin reserve would NOT be funded with purchases. Or in other words, it would have to be ‘taxpayer neutral’. This dealt a major blow to the reserve narrative and donors’ hopes. Bitcoin instantly fell from $121k to $118k, and as low as $107k a few weeks later. This started a prolonged period of Bitcoin underperforming the broader stock market.
For the second half of 2025, Bitcoin’s relative performance compared to QQQ has lagged markedly, shown below, suggesting investors are losing confidence in Trump’s ability to deliver a Bitcoin reserve, or pro-crypto policy in general, which–spoiler alert–for the above reasons, he won’t.
No Bitcoin reserve means it’s likely Bitcoin will fall back to $50k, which is where it was before he won. [Disclosure: I am shorting Bitcoin as hedge in anticipation of this, while also long ‘big tech’ stocks with leverage.]
History has generally shown when it comes to money, the only winner when dealing with Trump is Trump. This may sound like I am casting him in a negative light, but I still support him compared to the left, who are worse policy-wise. Wokeness is a greater ‘existential threat’ than crypto scams, but I would never invest in any of his crypto projects or give him money quid pro quo. Crypto donors will learn this lesson the hard way.
Online, there are plenty of grumblings about how Trump has not delivered on a reserve:
Moreover, interest groups, individuals, and industries that either opposed Trump before he ran or donated nothing or much less, have been lavished with taxpayer-funded bailouts and other aid, compared to nothing for crypto. This directly runs counter to Scott’s thesis. A year into Trump’s term has seen checkbooks opened for:
-Semiconductor companies, such as Intel. On August 22nd, 2025, the US government made a $9 billion investment in Intel. This generated huge coverage, as unlike in 2008, it was not like Intel was in dire straits, nor played an integral role in the financial system.
-AI. On Jan 21, 2025, “President Donald Trump on Tuesday announced a private sector investment of up to $500 billion to fund infrastructure for artificial intelligence.”
And just think, in 2008, a $800 billion bank bailout was seen as an inconceivably large amount of money and setting a major fiscal precedent, and now hundreds of billions are spent like nothing and without an afterthought, to get an idea of how people have become numb to such as large numbers, but also how much the US economy has grown.
-Quantum computing. On October 23, 2025, the WSJ reported that the “Trump Administration in Talks to Take Equity Stakes in Quantum-Computing Firms.”
-Rare metals. In October the Trump administration took equity stakes in “MP Materials, Lithium Americas, and Trilogy Metals.”
-A $20 billion lifeline for Argentina.
All of these, by definition, are taxpayer funded. When the government spends money, taxpayers pay for it. I wonder how crypto donors getting nothing fits into Curtis Yarvin’s ‘theories of power’. Those who donated the least or were woke before Trump entered office, such as AI companies and ‘big tech’, got the biggest embrace by Trump. Trump went from calling for Zuckerberg’s arrest in August 2024, to in November 2024 hosting him at dinner events.
On September 5th, 2025, Trump hosted 33 Silicon Valley ‘power players’ to a massive dinner. Many of these people oversaw or were privy to censorship of Trump supporters, 2020 election skeptics, or Covid vaccine skeptics, from 2016-2021, and did nothing or instructed it. This does not come as a surprise to me; I predicted it, after all. So why?
As I wrote earlier, a ‘crypto bailout’ is politically untenable. Trump is perfectly happy to accept crypto donors’ money, but has enough political commonsense know that using taxpayer dollars on crypto initiatives would be seen by the public, and even more critically, by opponents, as subsidizing gamblers, speculators, and a tiny crypto donor elite, and gives perfect ammunition for the left. Trump also sees AI and quantum computing as playing major roles in America’s competitiveness, such as against China, whereas crypto is seen as more like speculation or a hobby, than playing a key economic role. Millions of American use Chat GPT and other AI products, but crypto is like sports betting, which although popular, is understood to be more of a hobby, than essential for work.
Trump also understands power dynamics. And right now, the ball is in the court of ‘big tech’ and AI, not crypto. So Trump is going to pivot accordingly. Invoking ‘Moldbugianism’, for lack of a better word, ‘big tech’ was forced to embrace wokeness, as they were beholden to Democratic interests. With the left in retreat, tech companies have much more power and can thus reject wokeness. Trump probably understands this, which explains how he has forgiven many of those same companies and individuals.
Support for semiconductors and AI is much more bipartisan as well. It’s not like the left can hold it against Trump for wanting to make America more competitive against China , especially when Silicon Valley, which is still overall left-wing, is heavily involved in those AI and semiconductor companies.
So overall, I would say it’s way premature for Scott to declare that Andreessen and other crypto donors succeeded. Additionally, the above evidence also shows that those who donated the least or who formerly opposed Trump, got the most. It remains to be seen if Trump will actually enact a Bitcoin reserve (I again predict he won’t), but given that taxpayer dollars are off the table–and the fact that he never talks about Bitcoin unless it’s to promote one of his coins–it’s not promising. This again shows why donors do not donate more. There is no assurance of success. Crypto donors wanted Trump to make crypto a priority, and at best it has been pushed to the backburner compared to AI, chips, quantum and other stuff.