Candidates for state and local offices in California will once again be allowed to accept cryptocurrency donations after a ban was lifted Thursday by the state’s Fair Political Practices Commission (FPPC). The ban was imposed in 2018.
California was one of nine states that had political contributions prohibited in crypto due to perceived transparency and know-your-customer (KYC) issues. The issue of crypto inflows was revived in March when the commission Published a notice on the sale of non-fungible tokens (NFTs) for campaign fundraising.
In May, a report was prepared by the FPPC this examined three options for its crypto policy. These had to maintain the ban or treat crypto as cash, with a contribution cap of $100, as is done in several states.
The third option was to treat the crypto as an in-kind contribution, i.e. a good or service rather than cash, with the requirement that the contribution pass through a processor that uses the protocols KYC and have the contribution converted to fiat within two business days. reception. The value of the contribution would be the dollar exchange rate of the crypto on the day of the transfer.
The FPPC approved the third option in its decision on Thursday. California now joins 12 other states that explicitly allow political contributions in cryptocurrency. The decision takes effect in 60 days.
California has been a leader in adopting crypto in other areas. In February, a bill was introduced in the State Senate in February to make it possible to pay for state government services with crypto. This bill was not voted on in committee, but was granted a new hearing which has not yet taken place. Governor Gavin Newsom issued an executive order in May at harmonize national regulations with President Joe Biden’s Executive Order on Digital Assets.