Cryptocurrency donations were among the election issues discussed in the latest meeting of California Fair Political Practices Commission. In the meeting held on Thursday, August 16, members of the commission deliberated on whether contestants for public office can accept cryptocurrencies as part or campaign donations.
The subject of cryptocurrency got several contributions around the classification of such donations, maximum allowable limits, conversion, and reporting of such funds. They informally agreed to a cap of $100 per donation for the upcoming year’s midterm elections. The meeting did not, however, lead to any amendments as the members acknowledge they need a better understanding of the matter. Chairwoman Alice Germon remarked:
“I would be inclined to think that bitcoin is a thing that is not U.S. money but is more like a currency, like the euro. But I would like to hear more to develop my thinking on this.”
Speaking against the ban of cryptocurrencies in this regard, Commissioner Allison Hayward acknowledged the benefits of cryptocurrency and blockchain and encouraged her colleagues to take more time to understand the technology in other not to miss its benefits. She said:
“I think cryptocurrencies are obviously new and designed to be confidential but the blockchain technology I think might ultimately be a very robust tool in tracing activity […] I don’t think we’re there yet, but I would hate for something we do to forestall that later on. I don’t know what that would be but […] blockchain might be a very useful tool for us and I’d hate to prevent that.”
If the state decides to allow cryptocurrency donations, it can draw a sort of precedence from the Federal Electoral Commission (FEC) that approved cryptocurrency donations for political campaigns at the federal level. FEC categorized cryptocurrency as an in-kind donation.
At the State level, it may be slightly different as State laws require donations to come from within the state. Commissioner Brian Hatch raised the prospect of a candidate falsely claiming a crypto-donation that came from within the state. He too didn’t support an outright ban.