Ethics officials in the U.S. state of Wisconsin are divided on whether to allow political campaigns to accept campaign donations in bitcoin and other cryptocurrencies. If Wisconsin approves the move, it will join Montana, Washington, D.C., and the U.S. federal government in allowing cryptocurrency campaign contributions.
At a hearing on April 24, the Wisconsin Ethics Commission debated the issue but did not make an immediate decision, WiscNews reported. Leading the charge in favor of bitcoin donations was Phil Anderson, chairman of the Wisconsin Libertarian Party.
Anderson argued that cryptocurrencies “are more and more widely accepted as currency and as stores of value…The Chicago Board Options Exchange offers a futures market for bitcoin. And other financial platforms, corporations, and governments are weighing in on not ‘whether’ to address cryptocurrencies, but ‘how.'”
But several commissioners balked at the suggestion, saying they’re worried that anonymous crypto donations are untraceable, and therefore could open the door to violations of campaign contribution laws.
“If we can’t accurately and immediately describe who’s donating these funds, there’s a hesitation on my behalf to allow it,” said commissioner Pat Strachota.
Wisconsin State Representative Jimmy Anderson, a Democrat, tweeted that allowing digital currency donations “is really dangerous…The ability to conceal who is making the contributions alone is going to make this an ethical nightmare.”
In response, Libertarian Phil Anderson suggested that Wisconsin follow the guidelines used by the Federal Elections Commission, which requires that bitcoin be immediately converted to U.S. dollars and then reported as an “in-kind” contribution such as a gift.
The state of California has recommended that politicians not accept virtual currencies as campaign contributions, but does not prohibit the practice. The slow adoption of cryptocurrency campaign donations is surprising since a growing number of American politicians have already accepted them.
U.S. Senator Rand Paul of Kentucky famously accepted bitcoin campaign contributions when he ran for president in 2016. He eventually lost to New Yorker Donald Trump.
Rand Paul is a Republican by party affiliation, but an avowed libertarian by personal philosophy, so it’s no surprise that he embraces crypto.
Similarly, Missouri Republican Austin Petersen, who’s running for Senate, accepted 24 fractional bitcoin donations (totaling $9,700) in January 2018. Petersen’s campaign manager, Jeff Carson, said embracing cryptocurrencies aligns with his libertarian political philosophy.
“Austin is personally a fan of competition in the marketplace, even when it comes to our currency,” Carson told ABC News. “With the rise of cryptocurrencies like bitcoin, it was a no-brainer for us to use those.”
Many people don’t understand the hesitation to accept an alternate form of currency as a campaign contribution, since most politicians will take money from anyone who’ll give it.
“It’s just another form of payment,” said Paul Paterakis, the press secretary for a New York politician. “It’s a common misconception that bitcoin is truly anonymous. It’s not. It can be traced on the blockchain (the open ledger) quite easily.”
As the debate over crypto continues, bitcoin prices have enjoyed a robust rally during the past week, in part fueled by the Post Tax-Day surge portended by Fundstrat co-founder Tom Lee.
And the hits just keep on coming. After tech billionaire Tim Draper set a $250,000 bitcoin price target for 2022, a market analyst who accurately predicted both bitcoin’s recent slump and ensuing rally, has set a near-term bitcoin price target of $11,500 to $11,800, as CCN.com has reported.
“After fighting regulation headwinds and tax selling, the path of least resistance is higher, and I believe the sector still has much more upside in the long run,” said Bill Baruch, president of Blue Line Futures.
So despite the growing drumbeat of skeptics, many experts believe the outlook for bitcoin is dazzling, both in the short-term and over the long haul.
Featured image from Shutterstock.
Last modified: May 20, 2020 8:50 PM UTC