Bitcoin wins US election panel's approval for political donations

Federal regulator finds the cryptocurrency qualifies as "money or something of value" but imposes restriction on its use.

Bitcoins
Bitcoin

Bitcoins may soon be helping fund an election campaign near you.

The US Federal Election Commission on Thursday unanimously approved a proposal for political action committees to accept donations in the form of Bitcoin, finding that the cryptocurrency qualified as "money or anything of value" as defined by the Federal Election Campaign Act of 1971. However, with its 6-0 vote, the commission that enforces US campaign finance laws imposed several conditions on its acceptance.

PACs must sell the bitcoins they received and convert them to into US dollars before depositing the proceeds into a campaign account. The commission did not approve the use of Bitcoin to acquire goods and services.

The decision came in response to a proposal by the Make Your Law committee to accept individual Bitcoin donations up to $100. To address the anonymous nature of Bitcoin use, the MYL promised that all Bitcoin contributors would be required to provide their name, physical address, and employer.

While the decision was issued as guidance and not as new regulations, the commission's vote suggests that other PACs will be allowed to operate under similar conditions.

In its decision, the commission acknowledged that "government agencies, courts and others are grappling," but said it "expresses no opinion regarding the application of federal securities law, tax law, or other law outside the Commission's jurisdiction to MYL's proposed activities."

Bitcoin's acceptance has grown dramatically in the past couple of months. Cryptocurrency ATMs have begun to pop up, some casinos have said they would accept digital currency payments, and even eBay has begun allowing for limited sales of Bitcoins on its US and UK sites.

The FEC's decision comes a day after the US Securities and Exchange Commission issued an advisory warning investors to be wary of Bitcoin and other virtual-currency related investments. Noting that the cryptocurrency is uninsured, unregulated, and volatile, the SEC said its chief concern was the risk of fraud.

 

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