“If you’d like to see me in Congress fighting to keep Bitcoin innovation here in the USA, donate to my campaign. I’m running a grassroots movement. Each Satoshi can make a difference.”
Bitcoin and other crypto donations to political campaigns have been banned in California since 2018. Essentially, concerns surrounding grants being utilized to circumvent contribution limits and prohibitions were one of the main reasons the ban was implemented. Alongside, foreign entities contributing to campaigns was another facet of apprehension that was highlighted back then.
However, a few months back, a state regulator—the Fair Political Practices Commission—had scheduled a discussion to consider drafting amendments to the same. And now, in the latest development, the Commission voted on Thursday to approve new rules, green-lighting donations of digital currencies like Bitcoin.
This means candidates for state and local offices in California will soon be able to accept crypto campaign donations.
The ‘Bitcoin to fiat conversion’ catch
However, cryptos cannot be retained by the candidates. It’d have to be converted to fiat. This essentially rules out the odds of the donated amount abnormally amplifying or shrinking due to the market’s volatility. A recent Los Angeles Times report affirmed,
“The rules say candidates can accept cryptocurrency donations if they immediately convert the digital currency into U.S. dollars.”
The LA Times report further revealed that candidates must use a registered crypto processor to handle transactions. The same is to note each contributor’s name, address, occupation, and employer.
California’s new rules will reportedly come into effect within two months. Notably, California had been one of nine states that prohibited crypto contributions. Per a recent report, 12 states, along with Washington DC, allow cryptocurrency contributions in some form. The said disparity highlights how regulations remain widely varied within the US.
As far as California is concerned, candidates running for federal office are already allowed to accept cryptocurrency donations. Aarika Rhodes, an elementary school teacher, running to represent California’s 32nd congressional district, for instance, had revealed that her campaign had officially adopted Bitcoin Lightning Network for campaign donations in November last year. She overtly brought to the fore the accessibility the revolutionary technology provided and tweeted.