California Overturns Ban On Political Crypto Donations

A vote by the state’s Fair Political Practices Commission (FPPC) on “Regulation 18421.2 Cryptocurrency Contributions,” put forth last month, reverses a nearly four-year ban implemented during crypto’s prior bear market in November 2018.

An unrelated financial limit on how much a campaign can receive in contributions remains in place for California which now joins 12 other states and the District of Colombia in approving crypto donations.

Previous regulation had denied political campaigners the right to raise or receive funds via crypto. The ruling has since been repealed and those running for office may now receive funding in the nascent asset class provided it’s converted to fiat immediately.

Concerns over how crypto could interfere with campaign transparency led the FPPC to deny its use for political campaigns, though the digital asset industry has since matured significantly since the almost four-year ban.

“In drafting this legislation, we had to address the inherent concerns with cryptocurrency and the opportunity it presents for illegal contributions,” FPPC’s general counsel David Bainbridge said in a live-streamed commission meeting on Thursday.

Political donations made using crypto must be conducted via a US-based crypto payments processor or “other service” with strict know-your-customer measures and answerable to subpoena requests for records.

Anonymous donations in crypto to political committees will be barred and those individuals contributing will be subject to identification constraints including the collection of names, addresses, occupations, and employers of each contributor at the time the donation is made.

It is not clear if anonymous political donations to individual campaigners will be affected. Blockworks attempted to contact the FPPC on that point but is yet to receive a response.

Source: blockworks.co