California Lifts Ban on Political Crypto Donations
However, recipients must convert to USD immediately through the Department of Treasury.
The Fair Political Practices Commission of California (FPPC) announced that the ban on Bitcoin and cryptocurrency donations for political campaigns has been lifted. The unanimous vote ends a year-long ban on such donations.
A reminder… lots of things on the agenda (including crypto) for tomorrow’s monthly FPPC meeting. You can take part digitally from anywhere… details at the top of the agenda: https://t.co/QHCUSn7MQJ
— FPPC (@CA_FPPC) July 20, 2022
Previously one of nine States to ban the practice, California now joins Washington D.C., and 12 others in allowing the donation of crypto. However, the donations are required to immediately be converted to USD through the U.S. Treasury Department.
Considering federal regulations already allow for crypto donations, the lift will only change methods available for state and local levels.
Other stipulations for receiving crypto donations include the use of a U.S.-authorized payment processor and that contributors must have provided identifying information through a process known as KYC. This means that the name, address, occupation, and employer information of each contributor will need to be known or provided at the time of the donation.
It’s assumed that these steps have been taken to be sure crypto contributors do not have any more privacy than those using fiat or more traditional means of donation.
When reporting the value of the contributions the receiving campaign must report the crypto at its fair market value at the time of the donation. This and the fact that the contributions have to be immediately converted to USD keeps parties from claiming higher values than initially received and also protects the original value in the case of market fluctuations.