FEC: Donors can't use bitcoins for contributionsNovember 21, 2013 @ 9:27 am
WASHINGTON (AP) - Political organizations can't accept contributions in the form of bitcoins, at least for now, The Federal Election Commission said Thursday.
The commission passed on a request by the Conservative Action Fund, a political action committee, to use the digital currency. That group had asked the FEC recently whether it could accept bitcoins, how it could spend them and how donors must report those contributions. It was not immediately clear whether the same ruling would apply to individual political candidates.
Bitcoin is a cybercurrency that is relatively anonymous and is created and exchanged independently of any government or bank. Some retailers accept it, and the currency can be converted into cash after being deposited into virtual wallets.
But the FEC isn't yet sold on allowing bitcoins to funnel into the bank accounts of political campaigns and outside groups supporting them, and commissioners deadlocked 3-3 along party lines Thursday.
FEC chairwoman Ellen Weintraub acknowledged that she had never heard of bitcoins until she saw the Conservative Action Fund's request. Weintraub, a Democrat, raised the prospect of anonymous or foreign bitcoin donations _ both prohibited under federal law _ flowing into campaigns and outside groups. But she suggested the FEC would revisit bitcoins at a later date.
Some commissioners who supported bitcoin donations said current regulations already allow for bitcoin transactions. Republican Commissioner Lee Goodman, who was recently confirmed by the Senate, voted in favor of the fund's request.
Fund lawyers had asked the FEC as early as this summer about the use of bitcoin in a changing campaign finance system.
"Notwithstanding the worth of an individual bitcoin, their general popularity is soaring," they said in a letter, noting the Libertarian Party and other state-level candidates already accept the currency.
Bitcoins have gained increased attention by the U.S. government, particularly how they can be used alongside of more traditional currency. At a hearing this week before the Senate Homeland Security Committee, federal officials told lawmakers that bitcoin and other companies should receive greater scrutiny from financial regulators and other authorities.
This is not the FEC's first time debating how modern technology can square with the country's decades-old campaign finance laws. Last summer, for instance, the commission approved the use of political contributions via cell phone text messages.
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