Crypto’s wealthiest investors are escalating their fight with California’s labor movement, bankrolling a $40 million political machine designed to block a new wealth tax and weaken the unions that helped write it. The campaign, framed as a defense of innovation and economic growth, is also a test of whether a small group of digital-asset tycoons can reshape a state long dominated by organized labor and progressive Democrats. I see it as the sharpest collision yet between Web3 money and old-line union power in American politics.
At the center is a war chest built by crypto billionaires and allied venture capitalists who argue that California’s proposed “billionaire tax” would drive capital and talent offshore while entrenching what they describe as “tax-hungry” unions. Their strategy is not just to defeat a single ballot measure, but to build a durable moderate bloc in Sacramento that can outmuscle labor-backed Democrats on taxes, regulation, and the future of the tech economy.
Inside the $40M ‘Grow California’ war chest
The most visible vehicle for this push is “Grow California,” a political campaign led by Ripple co-founder Chris Larsen and venture capitalist Tim Draper that has secured a $40 m commitment to fight the state’s proposed wealth tax. According to campaign disclosures, the group has raised $40 million from crypto executives, venture funds, and companies like Ripple Labs and Coinbase, creating a pool of money large enough to dominate a statewide ballot fight. By any measure, that is a massive sum for a single state initiative, and it signals how central California’s tax policy has become to the digital-asset elite’s long term plans, with Grow California explicitly organized around that fight.
Separate reporting on the same effort notes that crypto billionaires have “deploy[ed] $40M” to oppose California’s wealth tax and curb union influence over fiscal policy, describing how Two high-profile Crypto figures are preparing to saturate the airwaves and digital platforms with ads. The group behind the spending has said it wants to show that concentrated political money can shift outcomes in California, a state where unions have long been the dominant force in Democratic primaries. The $40 figure appears repeatedly in filings and interviews, underscoring that this is not a trial balloon but a fully funded offensive, with $40M now the shorthand for the campaign’s scale.
The ‘Billionaire Tax Act’ that triggered Silicon Valley’s revolt
The immediate catalyst for this war chest is California’s 2026 “Billionaire Tax Act,” a proposal that would impose a one time levy on the unrealized gains of the state’s richest residents and then a recurring wealth tax on fortunes above a set threshold. Crypto leaders argue that the measure effectively taxes paper gains on volatile assets like tokens and equity stakes, forcing founders and investors to sell holdings or move abroad to meet tax bills. One detailed breakdown of What Exactly the state is doing, framed as “What Exactly is California Planning, and Why Are Crypto Leaders Angry,” describes how the Billionaire Tax Act in California would apply to global assets and has already prompted talk of relocation to hubs such as Dubai and Singapore, with Billionaire Tax Act opponents warning of an exodus.
Another analysis of California’s proposed 5% wealth tax on billionaires, set for 2026, notes that the levy would sit on top of existing income taxes and would be among the most aggressive in the world. Crypto executives quoted in that reporting say the plan threatens the crypto industry’s growth in California by making it prohibitively expensive to hold large token positions while living in the state. The backlash has been especially sharp among founders whose net worth is tied up in illiquid holdings, who see California’s proposed 5% wealth tax as a direct hit on their ability to keep building companies locally, a concern laid out in detail in coverage of California’s proposed levy.
Unions, “theft of unrealized gains,” and a new class war narrative
Crypto leaders have not been shy about how they see the politics behind the Billionaire Tax Act, casting it as a project of powerful unions that want to lock in higher public spending by targeting a small, unpopular class of ultra wealthy residents. One report on Crypto Leaders Oppose Theft of Unrealized Gains The describes how industry figures have joined other opponents of the 2026 billionaire tax act, arguing that taxing unrealized gains amounts to confiscation rather than normal taxation. In that telling, unions are not just another stakeholder but the driving force behind a bill that would, in their critics’ words, treat founders’ token holdings as a piggy bank for public sector contracts, a framing that appears in coverage of Crypto Leaders Oppose campaign.
That rhetoric is central to the $40 million push: by labeling the tax as “theft of unrealized gains,” the crypto bloc is trying to turn a complex fiscal measure into a simple moral question that can cut through in television spots and social media clips. It also helps explain why the campaign is targeting union power directly, not just the tax language. The same reporting that details the wealth tax backlash notes that California’s labor movement has been instrumental in shaping the proposal and is expected to pour money into defending it, setting up a clash between public sector unions and a new class of digital asset magnates. The union side is not fully detailed in the available sources, but the crypto framing of unions as “tax hungry” is explicit in the coverage of California’s proposed measure.
From Sacramento to Washington: crypto’s broader political machine
The California fight is not happening in isolation. Over the past two election cycles, crypto executives have built a national political infrastructure that is now being repurposed for state level battles. A group of industry leaders and political strategists formed Fairshake and Defend American Jobs and Pr as super PACs focused on federal races, pooling tens of millions of dollars from exchanges, venture firms, and individual founders. Reporting on that effort describes how Fairshake and its affiliates have already influenced congressional primaries by flooding the airwaves in districts where incumbents were skeptical of digital assets, a pattern detailed in coverage of Fairshake and its network.
That federal spending has been enormous by any standard. One analysis found that The Crypto Industry Spent Over $130 M on the 2024 Election, with $130 Million deployed across Senate and House races, including a tight contest in Ohio where crypto funded ads helped shape the narrative. The same reporting notes that It Paid Off, with several candidates backed by the industry winning and then moderating their rhetoric on regulation once in office. Those results have convinced many in the sector that concentrated political spending can deliver concrete policy wins, a lesson now being applied in California’s wealth tax fight, as described in coverage of Crypto Industry Spent that $130 Million.
Silicon Valley moderates versus California’s labor left
Within California, the $40 million war chest is part of a broader attempt by tech and crypto donors to build what they call a “moderate counterforce” to the state’s labor aligned left. Detailed reporting on California Crypto Billionaires Plan to Spend Tens of Millions on Moderate Candidates describes how a group of Silicon Valley investors is recruiting and funding Democrats who are more skeptical of new taxes and more sympathetic to business concerns. The same coverage notes that these donors want to influence which Democrats win office in key primaries, effectively shifting the party’s center of gravity in Sacramento, a strategy laid out in accounts of Silicon Valley donors’ plans.
A companion report on the same network of donors emphasizes that California Crypto Billionaires Plan to Spend Tens of Millions on Moderate Candidates not just in one cycle but as part of a long term project to counter the labor movement. The donors see unions as the main obstacle to loosening tax and regulatory policy, and they are explicit that they want a counterforce to the labor movement inside the Democratic Party itself. That framing, which appears in coverage of California Crypto Billionaires, makes clear that the $40 million anti tax push is one front in a larger ideological struggle over who sets the agenda in the country’s largest blue state.
A $193 m national war chest and the next phase of crypto politics
Even as they pour $40 million into California, crypto lobbyists are amassing a far larger pool of money aimed at Washington. One investigation into Furious crypto lobbyists describes how industry aligned super PACs have assembled a $193 m war chest to target key congressional committees and regulatory chokepoints in the 2026 midterms, not ordinary voters. The same report notes that Fairshake and its affiliate super PACs announced they have more than $193 million on hand, with a strategy focused on influencing who writes and blocks crypto legislation rather than simply electing “pro crypto” candidates, a plan detailed in coverage of Furious crypto lobbyists.
A related account of the same effort notes that Crypto Super PACs have raised $102 million in a shorter window to support crypto friendly US candidates, but stresses that the real target is not simply more pro crypto representatives. Instead, the strategy is to pressure the small number of lawmakers and regulators who control the flow of bills and enforcement actions, with major funding from Coinbase, Ripple, and a16z. That approach, described in detail in coverage of Crypto Super PACs, mirrors what is now happening in Sacramento, where the goal is to reshape the small circle of Democrats who decide which tax bills reach the floor.
California as a proving ground for crypto’s political clout
For all the national money in play, California remains the proving ground for whether crypto billionaires can actually beat entrenched interests like unions when the stakes are clear and the opposition is organized. Detailed coverage of Crypto billionaires deploy $40M to fight California wealth tax and union power explains how the campaign is targeting both the wealth tax ballot measure and the broader influence of organized labor in state politics, with Crypto funded PACs ramping up after their success during the 2024 federal elections. The same reporting notes that the wealth tax, if approved by voters, would apply to California residents’ global assets, a design that has intensified the industry’s sense that this is an existential fight, as laid out in accounts of Crypto funded organizing.
Other reports on the same ballot fight emphasize that Crypto billionaires deploy $40M to fight California wealth tax and union power as part of a coordinated strategy that includes television ads, digital campaigns, and direct contributions to moderate Democrats. The campaign is also closely linked to earlier warnings from crypto billionaires that California Planning a Billionaire Tax Act risks driving Web3 innovation to other jurisdictions, a concern spelled out in coverage of Why Are Crypto about the tax. If the $40 million effort succeeds in defeating the wealth tax and denting union influence, it will validate the industry’s belief that concentrated money can rewrite the rules in even the bluest states. If it fails, it will expose the limits of crypto’s political clout, despite a national war chest that now stretches from Sacramento to Washington.
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*This article was researched with the help of AI, with human editors creating the final content.
Grant Mercer covers market dynamics, business trends, and the economic forces driving growth across industries. His analysis connects macro movements with real-world implications for investors, entrepreneurs, and professionals. Through his work at The Daily Overview, Grant helps readers understand how markets function and where opportunities may emerge.
