Bitcoin millionaire puts money on Greens in German election

National News

FILE – This April 3, 2013, file photo shows bitcoin tokens in Sandy, Utah. A German software developer who made a fortune from bitcoin has given the environmentalist Greens one of the biggest political donations in the country’s history in the hope that the party will win this year’s national election _ and consider banning the digital currency. (AP Photo/Rick Bowmer, File)

BERLIN (AP) — A German software developer who made a fortune from bitcoin has given the environmentalist Green Party one of the biggest political donations in the country’s history in hopes it will win this year’s national election — and consider banning the digital currency.

Moritz Schmidt’s donation of 1 million euros ($1.2 million) to the Greens made headlines this month, as the party traditionally receives only small sums. Such a large gift is rare in German politics. Parties in the country receive most of their funding from members’ dues and state aid linked to election results.

“I have benefitted immensely from the bitcoin bubble. It’s been a wild ride, and the proceeds are unearned riches really,” Schmidt told The Associated Press in an email interview this week. “I’ve been sort of waiting for the right opportunity to donate a larger sum.”

The 39-year-old from the northeastern town of Greifswald, who hadn’t previously featured on any lists of major political donors, said he bought “a couple thousand euros” worth of bitcoin in 2011, shortly before it crashed, wiping 90% off the value of his holdings. Since then, bitcoin and other cryptocurrencies have repeatedly surged and slumped on investors hoping to turn a quick profit.

The value of a single bitcoin has dropped from over $64,000 to about $50,000 in the past ten days.

Schmidt, who made about 2 million euros ($2.4 million) by gradually selling his bitcoin over the years, said he learned in 2017 that the virtual currency consumes a vast amount of electricity. While the details are hotly debated by bitcoin fans and critics, experts say the power required to generate and trade cryptocurrencies is considerable.

“Being an energy hog is built into the bitcoin system,” said Schmidt.

The Greens advocate strong environmental policies to curb greenhouse gas emissions and fend off the threat of climate change.

Schmidt, who is cautious about the Greens’ prospects of winning the election outright despite their current high poll ratings, says he decided to help fund their campaign rather than donate toward an environmental project because “giving it to a political party that has environmentalism as its core value will have a much bigger impact.”

The Greens nominated 40-year-old lawmaker Annalena Baerbock as their candidate Monday to succeed long-time conservative leader Angela Merkel as chancellor in the Sept. 26 election. While the party doesn’t mention bitcoin’s environmental footprint in its program, it does want such currencies to be “traceable” — making bitcoin less attractive to many of its fans.

“I don’t think regulation will do anything unless it crashes the price down to levels that make bitcoin uninteresting as an asset and unusable as a global currency,” said Schmidt. “I believe that, in effect, bitcoin will need to be banned.”

Schmidt dismissed comments that suggested he might be trying to redeem himself for having traded in the cryptocurrency.

“Had I looked for absolution, I’d have turned to the Catholic Church,” he said.

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