Crypto Capital and Political Hedging: Analyzing Chris Larsen's Dual Endorsements in the California Governor's Race

The 2025 California gubernatorial race has become a focal point for crypto capital, with billionaire investor Chris Larsen-a co-founder of Ripple and a key figure in the cryptocurrency ecosystem-hedging his bets by endorsing both Democratic candidate Katie Porter and Republican Steve Hilton. This dual endorsement, while unusual, reflects a calculated strategy to influence policy outcomes and stabilize market expectations in a state that could shape the future of crypto governance. By examining Larsen's rationale and the candidates' platforms, we uncover how strategic political investing intersects with broader economic and regulatory trends.

Strategic Hedging: A Dual Bet on Affordability and Deregulation

Larsen's decision to back both Porter and Hilton hinges on their shared emphasis on "kitchen table issues" such as housing affordability, regulatory burdens, and business-friendly policies. According to a report by , Larsen defended Porter's resilience amid controversies and praised her ability to challenge "entrenched special interests" in Sacramento, while also highlighting Hilton's focus on reducing "burdensome regulations." This dual support suggests Larsen is prioritizing candidates who could streamline regulatory frameworks-potentially benefiting the crypto industry by reducing compliance costs and fostering innovation.

For Porter, a former U.S. Representative, this marks a reversal. During her 2024 Senate campaign, she faced a $10 million attack from the pro-crypto super PAC Fairshake, which Larsen co-founded according to the . Yet, her recent outreach to Silicon Valley and business leaders-including Larsen's maximum-donation endorsement-signals a recalibration. Porter's campaign emphasizes collaboration with the crypto sector while maintaining a focus on consumer protection and federal oversight, avoiding direct state-level regulation. This pragmatic approach aligns with Larsen's interest in balancing innovation with stability.

Hilton, meanwhile, represents a more overtly pro-business platform. His Golden Together organization advocates for slashing taxes, reducing bureaucracy, and dismantling "red tape" for corporations according to the . While no explicit crypto policies are outlined in his platform, his alignment with deregulatory goals resonates with crypto advocates seeking fewer restrictions on blockchain innovation. By supporting both candidates, Larsen ensures influence across the political spectrum, mitigating risks associated with California's polarized governance.

Implications for Crypto-Friendly Governance

The absence of detailed crypto-specific proposals from either candidate underscores the indirect nature of Larsen's strategy. Instead, his investments target broader policy goals that could create a favorable environment for crypto adoption. For instance, Porter's focus on affordability and business engagement may lead to reduced regulatory friction for crypto firms, while Hilton's deregulatory agenda could accelerate the integration of blockchain technologies in state operations.

This hedging strategy also reflects a growing trend among crypto capital to diversify political influence. By supporting both parties, Larsen avoids the volatility of single-candidate bets and ensures that the crypto industry remains a priority regardless of the election outcome. As noted by , this approach mirrors broader efforts by Silicon Valley to rebuild relationships with politicians who previously criticized the sector.

Market Stability and Policy Uncertainty

The long-term implications of Larsen's dual endorsements depend on how effectively the candidates can translate their general policy goals into crypto-friendly governance. A pro-business governor, whether Democrat or Republican, could streamline licensing processes for crypto firms, reduce energy costs for blockchain operations, or even explore state-backed digital assets. Conversely, overrely on deregulation without safeguards risks exacerbating consumer protection issues, which could destabilize market confidence.

For investors, the key takeaway is that political hedging by figures like Larsen signals a shift toward pragmatic, cross-party advocacy for crypto. This reduces the likelihood of abrupt regulatory shocks but also highlights the sector's dependence on political goodwill. observed, the California race exemplifies how crypto capital is increasingly leveraging political donations to shape policy narratives, ensuring that innovation remains a bipartisan priority.

Conclusion

Chris Larsen's dual endorsements in the California governor's race are not merely financial transactions but strategic moves to secure a crypto-friendly policy landscape. By backing candidates who prioritize affordability and deregulation, he is positioning the industry to benefit from reduced regulatory burdens and increased institutional adoption. While explicit crypto policies remain undefined, the broader alignment with business-friendly governance suggests that California's next leader-regardless of party-could become a pivotal figure in the evolution of crypto regulation. For market participants, this underscores the importance of monitoring political dynamics as a key driver of long-term stability in the crypto ecosystem.