The Kansas House of Representatives has been mulling over a bill that will amend the laws on political campaign donations involving digital currencies.
Presented by the House Committee on Elections, the proposed legislation seeks to preclude individuals from making digital currency donations above $100 to political campaigns in both primary and general elections. Digital currency donations under the threshold must be converted immediately to U.S. dollars and deposited into the campaign account, according to the bill.
All digital asset donations must be made through an exchange domiciled in the U.S. that fully complies with the laid down Know Your Customer (KYC) rules. Furthermore, the bill requires donors’ full names and addresses and an affirmation that they are the owners of digital assets.
The law appears to preclude donations from foreigners in Kansas’ electoral processes given the requirement of “an affirmation from the contributor that they are not a foreign national.
“The value of a cryptocurrency contribution is the fair market value of the cryptocurrency at the time the payment processor obtains possession of the contribution,” read the bill. “A campaign shall not make expenditures in the form of cryptocurrency nor hold cryptocurrency as a campaign asset.”
The bill is expected to become law following its publication in the statute book and after scaling the legislative hurdles of multiple readings, a vote, and assent from the state’s governor.
Digital assets and elections have always been sensitive issues in U.S. politics, with the Kansas Governmental Ethics Commission declaring that BTC donations were too furtive to be allowed in the electioneering process.
Digital currencies and elections
Despite the flak received from critics, digital assets are becoming part of U.S. election funding in recent years. In 2018, California imposed a ban on digital currency donations, but after nearly three years, the state’s Fair Political Practices Commission (FPPC) lifted the ban.
The FPPC mulled over three options for treating digital currencies, eventually opting to treat them as a service rather than funds. At least 12 states in the U.S. have approved digital currency donations for political campaigns, with industry executives like Sam Bankman-Fried donating millions of dollars to both Democrat and Republican campaigns.
A report from research firm Clvr stated that 60% of Americans supported using digital currencies for election donations under the present rules on fiat donations.
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