The Federal Election Commission has, for the second time, postponed ruling on whether political candidates and PACs can accept bitcoins as political contributions, and if so, how they should be treated by the recipient. During its open meeting yesterday, the FEC debated two different draft opinions addressing the request for an advisory opinion approving bitcoin contributions submitted in February by Make Your Laws PAC. The FEC’s six commissioners, who are evenly divided between the two political parties, decided to postpone issuing a formal opinion until a later date. A similar request, submitted last year by another PAC, similarly did not result in a ruling after the commissioners deadlocked in a three-to-three vote.
During yesterday’s meeting, the commissioners all appeared to agree that bitcoin contributions should be permitted, but could not agree on how. While the Republican commissioners argued that bitcoin contributions should be treated as in-kind contributions, the Democratic commissioners, citing the usual broad concerns about the anonymous nature of bitcoin transactions and their use in illegal activity, argued that they should be subject to the same limits as cash contributions. Federal law and FEC regulations allow contributors to give in-kind contributions to political committees in the form of goods, services, or anything of value, as long as the fair-market value of the contribution doesn’t exceed the legal limits. Cash contributions, however, are subject to a lower, $100 limit.
Despite yesterday’s deadlock, there is still hope that the FEC will rule on Make Your Laws’ request in the near future. The Commission’s Vice-Chair signaled interest in drafting a compromise opinion that would incorporate points of agreement between the commissioners. Specifically, there appeared to be some agreement on a proposed method for valuing bitcoin contributions; the commissioners also appeared to agree that political committees should be allowed to purchase bitcoins as investments. There is a good chance that a new draft reflecting the compromise will be considered at the Commission’s open meeting scheduled for May 8th.
While the FEC has not formally re-opened a comment period, it is likely that it will consider any submissions received before the request is reconsidered.