Crypto comes to rescue vulnerable House banking Republicans

• Key insight: Several senior banking Republicans are welcoming campaign help from the crypto industry in an election year when even traditionally strong red districts are at risk of flipping to Democrats. 
• Forward look: Most election prognosticators expect Democrats to win in the House, but while odds of flipping the Senate have improved, they remain too close to call. 

WASHINGTON —  Some of the most influential Republicans on financial services policy are facing unexpectedly competitive elections this November, and the cryptocurrency industry is coming to their rescue. 

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Fresh off a legislative defeat after a much-vaunted crypto market structure bill failed to pass the Senate last month, the crypto industry has ramped up spending in the 2026 midterm campaign to keep its allies in power. 

The president's party traditionally loses seats in midterm elections, but Republicans in 2026 are projected to have an uncommonly tough time at the ballot box in November, fueled by broad unease about rising prices and the ongoing war in Iran. That unease has expanded Democrats' playing field, with a number of what had been safely Republican districts suddenly in play. 

While none of these previously safe seats are necessarily expected to flip in November, their competitiveness is unusual — and cuts deep into Republican leadership in the House Financial Services Committee. 

While exact level spending by the crypto industry — and in which races — is unknown, the reelection campaigns for House Financial Services Committee Chair French Hill, R-Ark., Bill Huizenga, R-Mich., and Bryan Steil, R-Wisc. Each received at least $1 million in spending from Fairshake, the crypto election spending engine that is funded mostly by Coinbase, Ripple and Andreessen Horowitz.

Crypto isn't limiting its spending to House races, either: Sen. Pete Ricketts of Nebraska holds only a slim lead over independent Dan Osborn, a union leader who led a strike in Omaha's Kellogg plant several years ago. Republicans and a Fairshake super PAC are pouring money into that race to defend Ricketts, the son of the billionaire founder of TD Ameritrade and member of the Senate Banking Committee. 

The spending reflects a more defensive posture for an industry that has sought to demonstrate its ability to influence elections and elect lawmakers sympathetic to its priorities. Rather than simply backing new candidates, crypto interests are now spending to protect established allies whose positions could become more consequential if control of Congress changes hands.

"This is different," said Mark Hays, associate director for cryptocurrency and financial technology with Americans for Financial Reform. "They're not defending French Hill to show their power. They're defending French Hill to keep from losing a previous champion, and that's a more defensive posture as opposed to an offensive posture."

While these Republicans are not projected to lose their seats, there is an effect when senior lawmakers come back to Congress knowing their positions aren't as secure as they thought they were. But Ian Katz, managing partner at Capital Alpha Partners, said crypto's spending this time isn't likely to change their minds because their minds are already in support of the things the crypto industry wants. 

"Generally, not referring to these specific candidates, it's fair to suppose that a candidate who is well-supported by an industry will give that industry the benefit of the doubt later," Katz said. "In this case, I believe that those lawmakers are already sympathetic to the crypto industry."

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The unexpected vulnerability also points more strongly toward an aggressive stance by emboldened Democrats in a new Congress. 

As election day approaches, it's still up in the air if Democrats will win back the House and the Senate, although their chances of retaking the House look increasingly likely. Stifel chief Washington policy strategist Brian Gardner said that the base case at the moment is that Democrats win the House and Republicans maintain a slim majority in the Senate. 

If Democrats do win the Senate and the House, it could result in headline risk for banks and crypto, but the opportunity to pass legislation will be limited. 

"Democrats smell blood in the water regarding the Jeffrey Epstein scandal," Gardner said in a note. "As they investigate the Trump administration's handling of the matter, their inquiries could put some large banks in a negative light to the extent that these institutions had relationships with Epstein and if the inquiries produce new information." 

A full change in congressional control would also raise the prospect of more aggressive oversight of financial services companies and regulators. If Democrats take control of the House, new committee leaders will scrutinize the administration's regulatory decisions and examine relationships between lawmakers and the industries they oversee. And there could even be some areas where Trump and Democrats agree — areas that could spell trouble for banks.

"For banks, this is a risky outcome," Jaret Seibert, a financial services analyst at TD Cowen said in a note. "We still expect regulators to proceed with capital, liquidity, and tiering changes. But Democrats could push for populist outcomes that Trump has previously advocated, such as for a cap on credit card interest rates, limits on bank mergers, or even restoration on the separation between commercial and investment banking."