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Chris Larsen, co-founder and executive chair of Ripple Labs, has reportedly invested in a derivatives exchange founded by the son of U.S. Senator Kirsten Gillibrand, according to a Thursday Politico report. Larsen was among several investors backing American Perpetuals Exchange Corp. (APEC), launched by Theodore Gillibrand, with most contributions ranging from $5,000 to $10,000 each. The platform reportedly raised $30 million. The investment comes as Senator Gillibrand negotiates ethics provisions in the Digital Asset Market Clarity (CLARITY) Act, legislation that could significantly impact crypto companies like Ripple.
The CLARITY Act aims to provide regulatory clarity for digital assets, and Senator Gillibrand has been a key figure in drafting the bill. In May, she stated that no one would vote for the bill without addressing ethics, emphasizing concerns about insider access and potential conflicts of interest. Gillibrand's spokesperson referred to her June 18 statement asserting that her son is an independent adult and she has no involvement in his business. APEC did not immediately respond to requests for comment.
Democratic lawmakers, including Senator Elizabeth Warren, have pushed for stronger ethics language in the bill, citing President Donald Trump's ties to the crypto industry. Republicans hold a slim majority in the Senate, and GOP leaders expect the CLARITY Act to pass in July, with Senator Cynthia Lummis noting ongoing negotiations on ethics, decentralized finance, and illicit transactions. However, the bill will need at least 60 votes to overcome procedural hurdles, requiring some Democratic support.
The timing of the legislation is tight. Senators are on break for the Independence Day holiday, returning July 13, and will leave again for a month-long recess in August. This narrow window before the November election, which could cause further delays, puts pressure on lawmakers to finalize the bill. The investment by Larsen, a major figure in the crypto space, adds a layer of complexity to the ethics debate.
Senator Gillibrand maintains that her son's venture is independent, but the connection underscores the challenges of crafting ethics rules for legislators with family ties to industries they regulate. The outcome of the CLARITY Act negotiations will have broad implications for crypto regulation in the U.S., potentially setting precedents for how lawmakers handle conflicts of interest. As the July deadline approaches, senators must balance competing interests while addressing public concerns about ethics and transparency.
