Crypto Billionaire Among Dozens To Back Startup From Gillibrand’s Son

Democratic megadonor Chris Larsen has backed Sen. Kirsten Gillibrand’s political campaigns several times over the years.

Now, he’s got a new investment: her 22-year-old son’s startup.

Larsen, a cryptocurrency billionaire, is one of nearly three dozen Wall Street luminaries, venture capitalists and recent Stanford University alumni who have backed Theo Gillibrand’s new financial exchange venture — the American Perpetuals Exchange Corp., or APEC — according to a pitch document seen by POLITICO.

Other so-called angel investors include hedge fund manager John Griffin, Washington-based investor Mark Ein, and Anduril Industries founder Palmer Luckey, a longtime supporter of President Donald Trump. Annica Benning, a spokesperson for Theo Gillibrand's company, confirmed the list and called the investors longtime friends and mentors of his. She said the majority put in $5,000 to $10,000 each.

The who’s who of angel investors could raise new questions about the degree of separation between Theo Gillibrand’s startup and his mother’s political career. In addition to Larsen, both Griffin and Ein have also previously donated to Sen. Gillibrand’s campaigns. It comes as the New York Democrat is involved in negotiations to include ethics language in a landmark crypto bill pending on Capitol Hill.

Alex Tourk, a representative for Larsen, said Larsen was unable to discuss his investment in APEC but is “proud to support the organization.” Griffin and Ein did not respond to messages seeking comment, nor did a spokesperson for Anduril, a defense technology company.

When asked for comment, James Singer, a spokesperson for Sen. Gillibrand, pointed to her recent statement that she has no involvement with APEC.

“My son is a grown adult starting his own independent business. I have no involvement in it whatsoever,” Sen. Gillibrand said in the June 18 statement, after POLITICO reported on the company’s plans. “That said, I’m enormously proud of him and wish him nothing but the best.”

Unveiled last month, APEC has quickly become the subject of intrigue in Washington. That’s because, pending regulatory approval, the company wants to offer trading in a buzzy type of financial product that would be linked to U.S. stocks. But perpetual futures, as the products are called, were first popularized in the crypto markets — a business that Sen. Gillibrand has championed while in Congress.

Though Sen. Gillibrand does not sit on the committees that oversee crypto policy, she has long been the digital asset industry’s top ally among Senate Democrats. She has partnered for years with Republicans on industry-friendly crypto legislation — long before most other senators were paying attention to the issue.

She has more recently played a key role in helping to marshal Democratic support for the industry-backed crypto bill that Republicans hope to put on the Senate floor this month. She is helping to lead negotiations with Republicans over a government ethics provision that Democrats want in the bill to address concerns about the Trump family’s crypto businesses. The language under discussion would apply to members of Congress, though it is unlikely to cover their families.

Theo Gillibrand’s push to launch APEC comes on the heels of his graduation from Stanford. Last year, he worked as a fellow at the venture capital firm Paradigm, which is a major crypto investor, and before that, briefly on government affairs at Andreessen Horowitz, according to his LinkedIn profile.

Perpetual futures, or perps, represent a new frontier in finance. The products have been enormously popular on offshore crypto exchanges, where traders can use them to make turbocharged but risky wagers on the price of digital assets like bitcoin and ether. Unlike traditional futures, perps never expire. Offshore perps also often carry steep levels of leverage, which can intensify traders’ returns and losses.

Wall Street regulators recently signed off on the first official perps products in the U.S., setting off a wave of new interest from firms old and new. Among them is Theo Gillibrand’s APEC, which does not plan to offer crypto-related perps.

Larsen’s support for APEC should be of little surprise. The serial investor is a co-founder and executive chair at the crypto firm Ripple and has regularly backed companies as an angel investor.

The angel investments were in addition to the $30 million that APEC has raised from the investment firm Lux Capital, a fundraise that valued the company at $300 million, POLITICO and other media outlets previously reported.

Jasper Goodman contributed to this report.