If you have to convince somebody that something is money, it almost certainly isn’t. But there has been a marked shift in the world of digital currencies and crypto-denominated digital assets: their advocates seem to have long moved on from trying to convince us of their new and radical alternative to what they semiderisively (and semiaccurately) refer to as “fiat” currency.

The flaws in this story have always been apparent. For one, there has never been anything particularly “new” or “radical” about cryptocurrencies, the reactionary fantasy of apolitical money having a long and storied history. Meanwhile, the medium-of-exchange status of the “political” fiat currencies (which are more accurately described not as fiat- but as credit-based currencies, backed up by countless legal obligations to pay), particularly that of the key currencies (the dollar, the yen, the pound sterling, and the euro), has never been less in question.

For Bitcoin and its numerous equivalents, the opposite has become abundantly clear. They are not reliable media of exchange outside the confines of certain Central American dictatorships; not hedges against inflation; and due to changes in their value becoming highly correlated with conventional and volatile financial assets like stocks (and with erratic social media activity of billionaires), decidedly not reliable stores of value (rather, “three stocks in a trench coat”). The ancillary argument, usually evoked by those who concede these flaws, that the attendant technologies (notably the distributed ledger system known as “blockchain,” a glorified version of Google Docs or Excel) will transform our relationship with money, has also faded into the background, a process no doubt hastened by mounting consternation over the exorbitant environmental damages associated with crypto “mining.”

What crypto has instead revealed itself to be is a naked instrument of financial speculation and fraud, and a highly lucrative one. Far from removing politics from money and decentralizing power at the expense of oligarchic influence, crypto has become a vector of power and influence, not just for financial market participants — from professional traders and portfolio managers to the legions of insufferable crypto bros who flaunt their gains on the streets of Miami and Los Angeles — but for powerful actors in the tech industry wishing to gain a purchase on political decision-making. As a result, it has become an important arena of elite contestation. The current electoral campaign in the United States is a perfect showcase of this evolution.

Both the Democratic and Republican candidates are intimately connected to the California-based tech industry. But the incumbent Democrats have (too little, too late, perhaps) taken the first steps in introducing regulatory measures akin to those that exist in the financial industry. While the Securities and Exchange Commission (SEC), currently staffed by Joe Biden pick Gary Gensler, has over the last decade proven notoriously toothless in its job of curtailing the (often fraudulent) excesses of high finance, Gensler’s pugnaciousness and the specter of any infringement of Silicon Valley players’ ability to continue making enormous gains in the poorly regulated crypto world has mobilized many key actors behind Donald Trump, despite the former president’s initial disparaging remarks about Bitcoin.  The catalyst for the process seems to have been the downfall of the cryptocurrency exchange and hedge fund FTX (whose former CEO, Sam Bankman-Fried, was recently sentenced to twenty-five years in prison) and the deployment of congressional and regulatory resources (led by Gensler and Elizabeth Warren) that brought it about.

The fear of a concerted regulatory response by a new Democratic administration isn’t the only factor mobilizing this particular contingent of the Californian right. As Lily Lynch recently pointed out in the New Statesman, the very tech barons who are balking at government interference in crypto also view Kamala Harris as representative of a “competency crisis” caused by the Democratic elite’s embrace of identity politics and its supposed manifestation in the workplace, “diversity, equity, and inclusion” (DEI) policies, of which Harris is somehow said to have been the beneficiary.

The magnitude of these events is becoming all too clear. The new partisan dynamic in the crypto world has brought several prominent right-wing tech billionaires, with their ample resources pouring into newly created super PACs, the primary vehicles for supporting political campaigns in the United States, into the fray. Among this strange cast of characters are prominent tech venture capitalists and doyens of the neo-right Peter Thiel and Marc Andreessen, investors and entrepreneurs such as David Sacks, Cathie Wood, and Tyler and Cameron Winklevoss, and activist hedge fund manager Bill Ackman, as well as Elon Musk.

Trump’s volte-face on the issue has not just subsumed their concerns into the usual pseudo-libertarian Republican pabulum (with the Republican National Committee platform, under the guise of “championing innovation,” speaking of “the right to mine Bitcoin” and “the right to self-custody [over] digital assets” and to “transact free from government surveillance and control”) but has automatically entangled Bitcoin in national security matters. Among the many issues touched on in his unsettling interview in Bloomberg, Trump proclaimed that he would oppose any Democratic attempts to regulate the industry on account of not wanting China to gain an advantage “in this sphere.” The fact that there is little in the “technology” of digital currencies that confers any advantage in the grand geopolitical scheme of things, or the fact that China has pioneered cracking down harshly on unfettered speculation in crypto, matters neither to Trump nor to the average, low-information US voter.

American elections being awash with money is far from new. In fact, the system is set up to be particularly susceptible to the influence of well-funded and highly motivated special interest groups. And while the surge of the crypto-tech right is a new factor, donations can only take a campaign so far — especially when the opposing side is equally well funded by, among others, large tech firms.

In fact, the dominance of right-wing tech billionaires in the Trump campaign might prove to be a liability. This becomes clearer if we assume that Trump’s pick for vice president, Ohio senator J. D. Vance, a mentee of Peter Thiel, was motivated less by generic culture war considerations (the author of Hillbilly Elegy being a veteran of that theater) than by Trump’s desire to placate and win over the very crypto-adjacent Silicon Valley types that are now inundating him with money.

While the windfall will surely allow for an extensive ad campaign (though Trump’s relatively bric-a-brac but successful media efforts in 2016 proved enough), the excitement on the Right that initially greeted Vance’s ascendancy has recently been dampened. The Democratic campaign to paint the new right-wing culture warriors as “weird” has been aided not just by some of rumored couch aficionado Vance’s public appearances but also by the simple fact that the dramatis personae in the Silicon Valley story are also undeniably and deeply weird themselves.

Not only does their monomaniacal preoccupation with ever more arcane culture war issues fail to sufficiently resonate beyond the confines of podcasts and social media, the eccentricities of the likes of Musk (with his erratic and seemingly drug- and divorce-induced purchase and mismanagement of Twitter, now X), Thiel (with his sweaty, awkward demeanor onstage not helped by his well-established interest in recruiting young Stanford students to rejuvenate him with their blood), and Ackman (with his extremely public meltdown over his Israeli wife’s academic fraud and student protests over Gaza) now seem inextricable from Vance and his bumbling efforts to maintain composure.

Vance’s own attempt to reignite the culture wars has been dampened by the Harris campaign’s choice not to run on identity issues (thus rendering the “woke” or “DEI hire” talking points leveled against the former prosecutor Harris impotent) and to choose as her running mate Minnesota governor Tim Walz, whose confident “folksy-yet-progressive white guy” antics further highlight Vance’s faux down-to-earth-ness and anti-elitism.

It is of course far too early to know whether the Republicans are in the process of regrouping or painting themselves into a corner. Contributions from Thiel et al. will undeniably help to pad the pockets of the Trump campaign. But whether this will be an asset or not is unclear — the former president succeeded in 2016 despite being vastly outspent by Hillary Clinton. Undeniably, Trump’s embrace of the most regressive section of the tech industry is a gamble. If it pays off, it will bring one of most venal and unproductive sectors of American capitalism closer to power; but if it fails, it might provide Democrats with a chance to put an even tighter regulatory noose around tech’s neck. Whether they will take that chance is an open question.