Michael Carbonara is competing for a seat in Florida's 22nd Congressional District, utilizing an innovative approach to raise campaign funds through what he describes as crypto "gambling."
In remarks to the Miami Herald, Carbonara explained, “Campaigns do invest in the stock market, they invest in treasury bills, and it’s not uncommon for campaigns to generate passive revenue or income based on the idle cash sitting there. So this was just one vehicle, and I was trying to show that this was something that could be done.”
His strategy has proven fruitful. In June of last year, Carbonara invested approximately $95,000 in Ethereum. Just two months later, the value had surged to $170,000, resulting in a profit of $75,000 that he subsequently directed towards his campaign.
Overall, Carbonara has reported $6 million in campaign investments. However, there are questions about the accuracy of this figure since the crypto money appears to have been counted twice—once upon investing and again upon withdrawal for campaign use, as highlighted by the Herald.
This reported $6 million represents about a third of the total $18 million raised by all candidates in the 22nd District, establishing it as the most-funded congressional race in Florida.
Carbonara has faced scrutiny for utilizing his former company, Ibanera, to facilitate these cryptocurrency transactions. His campaign has paid a minimum of $21,000 in investment fees to the company over 16 transactions, which include about $8,600 incurred before he resigned as CEO last October.
While election law allows candidates to use their own companies, the necessity and fair market value of the crypto purchases have come under debate. Ibanera itself is dealing with legal challenges, including lawsuits over delayed payments in cross-border transactions from banks in the Bahamas and the UAE. Additionally, Carbonara is named in a separate lawsuit filed by Michigan due to noise complaints linked to the company’s cryptocurrency data-mining center situated near schools.
Currently, Carbonara is considered the frontrunner for the Republican primary, with Kalshi assigning him a 54% chance of winning. This places him ahead of competitors David Burck and Belinda Keiser. Initially, Carbonara was favored until Keiser's entry into the race in June, at which point she had a 68% chance of winning but has since fallen behind.
Keiser faces criticism due to her past contributions to Democratic campaigns and her university's connections in China, although some polling still lists her as a leader in the race.
With Carbonara now positioned as the leading candidate for the Republican nomination, the party’s prospects of retaining the seat have improved significantly, rising from a 24% chance in April to 64% today. On the Democratic side, Pia Dandiya is likely to be Carbonara’s opponent, commanding a 95% chance of winning her primary.
The lines between investment and gambling have become increasingly blurred in this context. Other candidates have ventured into similar territories; for example, Kyle Langford, a candidate for California governor, placed a wager on himself that resulted in a $2,000 fine and a five-year ban from Kalshi. Langford later withdrew from the gubernatorial race to shift his campaign focus to a U.S. House seat.
Additional candidates like Mark Moran in Virginia, Ezekiel Enriquez in Texas, and Matt Klein in Minnesota have been penalized for betting on their own campaigns at Kalshi, with the operator issuing fines and imposing bans in each case.
