US Federal Election Commission to Weigh Legality of Bitcoin Donations

September 12, 2013 By: Kevin Xu

Money and politics tend to go hand-in-hand, but what if a donor chooses to give bitcoins instead of dollars?

That’s the issue currently being explored by the Federal Election Commission, after a conservative political action fund asked for permission to give and receive bitcoins.

The digital currency has been a hot topic, due to its investment and disruptive potential, not to mention government agencies such as FinCen questioning bitcoin transactions as avenues for money laundering.

Some candidates from the Libertarian party are already accepting bitcoin donations, most notably Darryl Perry, who stated that he would not take donations of government-backed currencies.

Of course, there are issues that stem from bitcoins and their fluctuating price. The law in place requires every donation that exceeds $200 to be reported. Bitcoin’s volatility opens up some confusion on the reporting requirement, especially if bitcoin donation jumps past $200 after a politician receives it.

The FEC has two months to decide on this issue, though it may extend its time of deliberation.

This is just another case of bitcoin raising some very valid questions, and challenging the status quo.

One bitcoin advocate claimed that the currency can actually be a replacement for many of the financial systems in place today, including Wall St., at TechCrunch’s Disrupt conference this week.

Though that has yet to happen, the fact that bitcoin is causing such a stir in many aspects of the global economy is a sign of its potential as an agent of change.