The US Federal Election Commission (FEC) has delayed a formal decision on whether to allow bitcoin-denominated campaign contributions, widely expected to be announced today. However, a senior official suggested that limited contributions may be acceptable in the future.
As reported by The Hill, the commission was considering a petition to allow bitcoin campaign contributions in amounts up to $100. The petition was submitted by Make Your Laws (MYL) PAC.
During the meeting, Commission Vice Chairwoman Anne Ravel reportedly gave voice to potential issues regarding the anonymity associated with bitcoin campaign donations, saying:
“I have serious concerns about allowing unlimited bitcoin political contributions.”
She added that she would support a compromise on limited bitcoin campaign contributions, so long as they are treated like cash donations, which are capped at $100.
Other members of the commission voiced support, including Ellen Weintraub who said that “a majority of commissioners would be prepared to say yes” to MYL PAC’s petition.
The FEC told CoinDesk that the decision will be delayed until the FEC’s next meeting on 8th May.
Early efforts stalled
Last November, the Conservative Action Fund (CAF) sought guidance on bitcoin campaign contributions. The FEC’s original draft opinion, dated 7th November, was encouraging. It allowed bitcoin donations, treating them as in-kind contributions under valuation, reporting and disbursement procedures.
There were some limitations, however. CAF was told that it could not make disbursements using bitcoins. It would have to sell all bitcoins it managed to raise and deposit the proceeds in its campaigns accounts before using them.
CAF told the FEC that it plans to use bitcoin payment processor BitPay. Since BitPay’s model allows clients to receive either bitcoin or US dollars, the FEC caveat does not make much of a difference.
CAF said it would not accept anonymous contributions. Anyone who makes a contribution in bitcoin will be required to disclose personal information needed to ascertain the donor’s identity.
New petition more limited
After efforts by the CAF stalled, Make Your Laws (MYL) PAC sought more information on bitcoin contributions from the FEC. Unlike CAF’s request, MYL wanted clarification on a few new issues. The PAC proposes to accept, purchase and disburse bitcoins in compliance with FEC regulations, and offered an explanation of how it would prevent itself from accepting anonymous contributions.
However, MYL is proposing a number of limitations. Bitcoin contributions would be limited to $100, contributors would have to reveal their identity by providing their name, occupation, address and other details. They would also have to confirm that they are donating their own bitcoin rather than channelling funds for a third party. MYL plans to cash out the donations in US dollars.
The FEC pointed out that bitcoin does not meet regulatory definition of money and they are not negotiable instruments. Therefore some limitations apply, as bitcoins do not come with an unconditional promise to pay a fixed amount of money for each bitcoin.
An official press release on today’s announcement is expected later today, the FEC said.
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