On January 25th the Electoral Union issued a decree to the U.S. House of Representatives in Kansas to limit political donations made by passwords to $100. Whether the law is successful or not, Kansas will not be the first jurisdiction to make secret donations. From authoritarian countries like Ukraine or our country to electoral democracies like Spain or Australia, you can see recent attempts around the world to ban donations of data encryption to politicians.
Password reformers may have an advantage-it is hard to imagine a healthy democracy, in which case many cannot track the liquidity of money among candidates. However, before the advent of Hiragana password property, there were also problems with the use of money laundering and the use of tools to distribute it in the political system. The field has not yet had its best days, but the topic of password-selected donations is still a relatively safe space for innovation. Can this change before the time of the next election cycle?
2014 rules and $6600 ceiling
The United States Electoral Union (FEC), the independent body responsible for implementing electoral methods, first contacted the topic of data encryption donations in 2014. At that time, digital currency was not a problem, and the price of a bitcoin was around $300. Perhaps this is the main reason why FEC is so lucky with this new problem. It thinks it is possible to donate bitcoin (bitcoin only), but limits it to "physical donations" and non-currency-themed activities such as free online advice or concert performances.
Although Bitcoin donations are significantly included, Bitcoin donations are still called non-secret names and are the same as the upper limit for immediate cash donations. The minimum amount of such donations continues to grow in line with inflation from one election cycle to another-$3300 for the first trial by 2024, and will remain the same for the presidential election. The location of "physical donation" also prevents theme activists from directly using the bitcoin they receive-they have to "settle" it and deposit the money into their own accounts.
But in the American political system, there is a warning. Although my donation is likely to be very limited, we can always support the political Action Committee (PAC) by donating more than $41300 a year. There are also very political action committees, with no limits. Technically, very PAC can't make any immediate contributions, but they can spend unlimited money, unlike his campaign to give marketing support to his candidate.
There is at least one success story-BitPAC-- specializes in promoting digital currencies and blockchains. It accepts donations from Bitcoin, Ether (ETH) and Litecoin (LTC) and uses them to support foreign presidential candidates, congressional candidates, extraordinary political action committees and grass-roots organizations.
There have been no major announcements about password donations from FEC since 2014, although the total market value of bitcoins has continued to rise since then, let alone selling and choosing hundreds of other digital currencies.
There is also a key exception that cannot change dynamic passwords (NFT). In 2022, the Federal Electoral Federation felt that it was "permissible" to push NFT to political donors without violating the company's donation requirements. Earlier in 2019, FEC approved Omar Reyes's publicly issued ERC-20 dynamic password for its congressional election incentive program. The agency determined that such tokens are mementos with no intrinsic value.
Kansas or Florida?
Over the past decade, most states have been able to accept vague proposals from the Federal Electoral Federation for password donations. Only due process in South Carolina, Missouri and Kansas does not allow all data encryption donations. In the early days, password donations slowly spread with the support of enthusiastic politicians such as Rand Wade, Austin Peterson or Jared Polis.
But in the 1920s, when 1/5 foreigners got along with passwords to some extent, and the field itself became a kind of problem for global regulators, the mood shifted in the other direction. In April 2022, Spain became the first European country to declare a ban on data encryption for political donations. As Darragh O'Brien, Spain's minister of housing, local government and property, told the media at the time, the law was dedicated to safeguarding Irish democracy "as the threat of cyber war against free countries continues to improve".
This year, Kansas first discussed political donations in the state legislature. Regional U.S. House of Representatives decree No. 2167 sets a $100 ceiling for any political candidate in the state's first trial or presidential election. In addition, even for donations of less than $100, the recipient should immediately convert the password into US dollars, rather than using the password for expenses, not owning assets.
However, there is no reason for everyone to be happy. Four years after the restrictions were imposed, candidates in Florida state and district offices once again allowed them to accept donations in digital currency. Last year, the State Association for Fair and just political practices (FPPC) lifted the restriction after taking into account three strategies for password donation.
Like Kansas, the $100 cap is on the table, but FPPC is determined to follow the original FEC prescription and treat encrypted data donations as physical donations. Pulandian joins 12 other states that have established digital currencies that allow political donations.
Password donation in 2024
Why hasn't FEC pulled out all the important updates when the situation in the cryptographic world has been changing rapidly over the years? At first, the 2014 ruling was not finalized until 2019, so despite the audit report, as George Dobelle, co-founder and CEO of Engage Labs, told Cointelegraph, it is not that old. This, he said, "has always been a very good standard, allowing for good cryptographic political donations."
Derek Georgiaz, founder of Pastel Network, believes that the pace of FEC is in line with the actual foreign general password policies and regulations. Compared with traditional finance, passwords are still a very new industry, and FEC is likely to be uncertain about how to regulate password donations, so it is difficult to implement all controls. He further said that the time had come for some upgrades to the password donation, she told Cointelegraph:
"with the recent turmoil in the field of passwords, regulators are now looking forward to ensuring more picture quality and clarity in the field, and we will see more stringent regulatory announcements at the beginning of the next election cycle."
McGinnis Young, chief executive of White Swan Bitcoin, is not so optimistic about the chances of getting the latest report from the Federal Electoral Union before the next election cycle. In an interview with Cointelegraph, he stressed the polarization of political trends at this stage.
Because of the division of the United States Congress, it is likely to be more difficult for the law to be justified than you think. It is unlikely to introduce all password election laws into the decrees signed by both houses of Congress and signed by the President of the United States, "he said."
Due to the turmoil in the sales market brought about by the password winter of 2022, a new password donation policy and regulation is always likely to be unfriendly to the industry. However, on the other hand, there is still no scandal involving the publication of passwords in the election donation industry.
Of course, there is also the case of Rob Bankman-Fried, and he donated $40 million to the two ruling parties in the United States and tried to go back later. However, like the password industry's exhortation and diligence, technically, this has nothing to do with the topic of password election donations. "in fact, there is a very compelling example that political finance brings a real test case to blockchain applications that can be used to significantly improve transparency and traceability," D'Aubert said.
"there is reason to be positive about strict regulation of password donations in the future," Georges said. It takes time for expertise to develop and spread to regulators; there were few examples of Internet regulation in the 1990s, and there is still a strong appetite.
It is hard to imagine that the implementation of policies and regulations is absolutely perfect, but over time, there will be more and more understanding of the technology; regulators will become more and more skilled and aware of where passwords may affect competitive fund-raising and where risks need to be reduced.
Georgia des concluded: "to do this, there must be enthusiasm and a lot of culture and education."
State caps or federal regulation: What's next for political crypto donations
The industry isn’t having the best of its moments now, but the topic of campaign donations in crypto remains a relatively safe space for innovation.
Bitcoin to $100K next? Analyst eyes ‘textbook perfect’ BTC price move
Bitcoin is in the midst of a “bump & run reversal” which demands serious upside, argues Capriole CEO, Charles Edwards.
Bitcoin derivatives suggest $26K resistance level won’t hold for long
BTC margin and options markets show no signs of discomfort or overconfidence despite 28% gains in two days.
Gemini says no funds at Signature Bank backing GUSD
The company stated that it previously had a relationship with Signature but said it no longer has funds there.