New Kansas Bill May Limit Political Donations in Crypto to $100
by Arthur · February 15, 2023
The Kansas Legislature is considering a new bill that would enforce a $100 cap on crypto donations for use in any primary or general election.
This limit, should the bill pass, will be based on the “fair market value” at the time the crypto is received by the payment processor.
The bill also proposes much stricter rules for how crypto can be used by political campaigns in Kansas. Under the new rules, crypto donations received must be immediately converted to US dollars and then deposited into the campaign account.
Political campaigns would also not be allowed to use cryptocurrencies or hold them as an asset for the long term.
It is not only the size of the donations and the use of cryptocurrencies that are set to be limited. According to the bill, political bodies would also be forced to perform more due diligence on how crypto donations are processed.
Under the proposed rules, crypto donations can only be accepted if they come from a crypto payment processor based in the United States. This processor will then have to use procedures that make it possible to “form a reasonable belief” that the true identity of the contributor is known.
These procedures are set to include obtaining the name and address of any contributor when the contribution is submitted, which will then be forwarded to the party committee.
There were no specific rules for cryptopolitical donations in Kansas before, based on previous legislation.
In contrast, although California actually banned the use of crypto donations for state and municipal political races in 2018, state lawmakers recently voted to end the ban.
Crypto and US Political Donations
Crypto donations have already made a significant footprint in the financing of US elections.
In accordance Bloomberg$580,000 in cryptocurrencies were donated to various political campaigns for the 2022 election cycle. This number may have been higher, but some political action committees did not report these contributions to the Federal Election Commission (FEC).
Third-party commentators, such as the Swedish intergovernmental organization International Institute for Democracy and Electoral Assistance, have also criticized the potential role of cryptocurrencies in elections around the world.
The institute has argued that cryptocurrencies designed for anonymity could “hinder the work of oversight agencies and allow illegal donations to enter the system.”
