Winkelvoss Twins Donated to NY Governor Ahead of a Crucial State Approval

The Winklevoss twins, billionaire owners of a cryptocurrency exchange Gemini, donated a total of $130,000 to the governor of New York just one month before their exchange was approved by the state to list ZCash, according to a report in the New York Post.

The close proximity of the contribution and the crucial decision, might imply on an alleged influence on the governor’s judgement.

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Pay for trade?

According to a state filing, made public on Tuesday, the Twins continued to contribute $100,000 in April and an additional sum of $30,000 in June.

The donations were made ahead of the upcoming elections for state governor. Cuomo has been the governor of New York since 2011 and will stand for re-election in November of this year.

Source: governor.ny.gov

Shortly afterwards, on May 14, the Department of Financial Services (New York State’s financial regulator) granted the Winklevosses’ firm, Gemini Trust Company, the license to add ZCash to its listings.

Source: dfs.ny.gov

The exchange is indeed the first cryptocurrency exchange in the world to list ZCash, as Finance Magnates reported at the time. ZCash is a fairly new cryptocurrency with a market capitalization of $945.3 million, according to coinmarketcap.com.

The relevant license is called the BitLicense, which was created by the New York Department of Financial Services in July 2014 and came into effect in August 2015. According to Fortune, the license caused many Bitcoin companies to leave the city because it costs tens of thousands of dollars to apply for one.

According to the article, the twins then gave Cuomo another $15,000 on June 20 (2018). For the current campaign, Cuomo has reportedly raised $6 million in six months while his opponent, Cynthia Nixon, has raised $1.6 million since March.

No influence, allegedly

Cuomo reelection-campaign spokeswoman Abbey Fashouer said: “We appreciate their support. No contribution of any size influences any government action.”

New York Department of Financial Services spokesman Richard Loconte said: “DFS takes care in reviewing every application. The department has no knowledge of political contributions and such contributions have absolutely no bearing on DFS’s independent authority and decision making.”

A Winklevoss spokesperson said: “Tyler and Cameron Winklevoss have supported — and continue to support — many effective leaders around the country. They contributed to Gov. Cuomo’s campaign because they believe he’s doing a great job, is a problem-solver, and is definitely the right person to lead New York in the years ahead.”

The report notes, however, that this was the first time that they have donated to Cuomo, who has already served two terms as governor.

Gemini and regulation

In March 2017, the Securities and Exchange Commission rejected Gemini’s application to list Bitcoin exchange-traded funds, which are a kind of financial derivative. After Bitcoin futures were approved at the CBOE in December 2017, hope was revived, but in January one of Gemini’s lawyers said that he considered approval unlikely.

In a further development, in June 2018 the twins acquired a patent for the world’s first Bitcoin exchange-traded products, which are a kind of derivative that includes ETFs.

According to Bloomberg, which cited anonymous sources, Ripple offered a cash payment of $1 million to Gemini in return for the exchange listing XRP. The offer was declined. At the time, a Ripple spokeswoman told Bloomberg that this was “inaccurate” but did not specify further.

Cameron and Tyler Winklevoss are twin brothers who in December 2017 became the world’s first Bitcoin billionaires. Their exchange is licensed by the New York Department of Financial Services and has daily trading volumes of $70.8 million, according to coinmarketcap.com.