The Fellowship PAC, a newly established political action committee tied to Tether, has disclosed its first expenditure, with $300,000 going to Nxum Group for advertising services in support of Georgia Republican Clay Fuller. Nxum Group was co-founded by Bo Hines, who now serves as the CEO of Tether's US arm, and his father Todd Hines. The PAC's first expense filing with the Federal Election Commission indicates that the payment was made for advertising services provided to Fuller's primary election campaign. The Fellowship PAC, which claims to be 'rooted in transparency,' has not responded to questions regarding its formation, funding, or the payment to Nxum Group, which may benefit Tether's US CEO and his relative.
According to Michael Beckel, a representative from the political reform organization Issue One, there is no blanket prohibition on self-dealing in political committees like the Fellowship PAC, as long as services are provided at fair market value. The PAC's advertising effort on behalf of Fuller is not yet clear, but the funds were transferred as Fuller was winning his special election. Despite an announcement last year that the PAC would be established with pledges of $100 million, its current accounts show no contributions, and it is unclear whether the promised funds have been received.
An outside spokesperson for Tether stated that Tether International has no affiliation or oversight over the Fellowship PAC, but did not respond to further questions about Tether US. The PAC became active again this month with the announcement of its chairman, Jesse Spiro, who is also the vice president of regulatory affairs for Tether's US arm. The Fellowship PAC has begun listing endorsements for Republican politicians seeking House and Senate seats, as well as a candidate for governor in South Carolina, on its social media feed.
The PAC claims to support advocates of emerging digital assets technology and will begin actively supporting candidates aligned with this vision. The first recipient of financial support from the Fellowship PAC is incoming Republican member of the House of Representatives Clay Fuller, who won a special election to replace Marjorie Taylor Green. The money spent by the Fellowship super PAC was an independent expenditure, meaning it had to be handled without strategizing with Fuller's campaign.
As a candidate, Fuller has not publicly stated his position on crypto, but has the backing of President Trump. The firm paid by the Fellowship PAC, Nxum Group, was co-founded by Bo Hines, who filed ethics disclosures last year as a White House official. It is unclear whether financial ties remain between Hines and Nxum Group.
The PAC's treasurer, Mitchell Nobel, is an executive at Cantor Fitzgerald, a firm that manages assets for Tether's global operation. When the Fellowship PAC was announced last year, it was presented as a contrast to previous political engagement, aiming to help the broader crypto ecosystem and not 'narrow or individual interests.' The PAC's disclosures do not yet demonstrate a stockpile of contributions to back other candidates, and it is possible that some or all of the promised $100 million is in the PAC's coffers already. The relatively young Tether US's stablecoin, USAT, has a market cap of about $37 million, suggesting the firm may not have the independent resources yet to fund a major PAC.
According to Beckel, massive spending by an industry is something that lawmakers are taking seriously, but it is also possible that the Fellowship PAC's threats are 'paper tigers that never materialize.' The rival crypto super PAC, Fairshake, has expended millions in early contests, and the Fellowship PAC's spending is still a drop in the bucket compared to Fairshake's receipts. The US midterm elections are already underway, and the Fellowship PAC is focusing its support on Republicans, almost all of whom are in deep-red regions. If they win, they may face a challenging shift on Capitol Hill next year.