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Crypto Watchdog, a recently launched advocacy organization, is stepping up its campaign in Washington by highlighting the risks associated with digital assets, while leaving the identities of its financial supporters undisclosed.

The crypto sector’s main policy objective in the U.S. is to secure legislation that provides a clear regulatory framework and positions digital assets within the broader financial system. However, as the Digital Asset Market Clarity Act faces a challenging final stretch in the Senate, Crypto Watchdog has launched ads that connect crypto with criminal activity.

The group’s television and social media advertisements argue that bad actors use cryptocurrencies because of insufficient safeguards. The campaign points to alleged connections between crypto and activities involving drug cartels, terrorist groups, and scams targeting elderly victims.

The ads conclude with a call for stronger oversight, urging lawmakers to “bring crypto out of the shadows.”

The organization is led by Executive Director Chapin Fay, a communications strategist who previously worked on Republican political campaigns but had no established history in crypto policy.

Fay said Crypto Watchdog’s mission is to increase transparency and public awareness around the cryptocurrency industry, which he described as a multitrillion-dollar market that has not always provided enough visibility into its operations.

The group launched its efforts as lawmakers entered the final phase of negotiations over the Digital Asset Market Clarity Act. The bill has faced uncertainty as some Democrats and Republicans continue to disagree over several important provisions.

Fay said the organization wants both policymakers and the public to better understand the potential risks and challenges associated with digital assets as the regulatory debate continues.

Crypto Watchdog cited a June survey of 1,000 voters showing that 65% of respondents expressed significant distrust toward cryptocurrencies. The group said the results matched broader concerns reflected in previous industry surveys.

Despite its focus on transparency, however, Crypto Watchdog has not disclosed its own sources of funding. Critics have compared this approach to other political advocacy groups on both sides of the crypto debate that operate without revealing their donors.

When asked who financed the campaign, Fay declined to provide details, saying he could not comment on behalf of the group’s supporters. He argued that transparency expectations for the crypto industry and disclosure rules for advocacy organizations are separate matters.

Fay has rejected claims that the group is anti-crypto, though much of Crypto Watchdog’s messaging centers on industry failures, including hacks, fraud, and security breaches.

The campaign arrives as the Senate faces a narrow window to advance the Clarity Act before its summer recess. Although lawmakers from both parties have resolved many disputes, a major remaining issue involves restrictions on government officials’ crypto-related activities.

Democrats have pushed for tougher ethics rules, citing concerns involving former President Donald Trump. Trump supported an earlier proposal, but many Democrats argued the restrictions did not go far enough. A bipartisan compromise is now awaiting further review.

Crypto supporters view the final Senate session before the recess as a critical opportunity to secure the 60 votes needed to advance the bill. If the effort fails, negotiations may continue when lawmakers return in September.

The legislation also faces opposition from banking groups, which argue that stablecoin reward programs offered by crypto platforms could draw deposits away from traditional banks and create risks for the banking system.