The Federal Election Commission debated a proposal Thursday to let candidates and committees accept bitcoins as in-kind contributions, in the same way computer equipment or shares of stock are sometimes given as donations.
The six-member panel appeared to be leaning toward sanctioning them, as long as it can resolve concerns about whether the Internet cash could be used to mask the identities of donors.
“There’s a balancing act here,” Commissioner Matthew Petersen, a Republican appointee, said at the end of an hour-long discussion. “There’s this new technology that no one wants to strangle in its infancy,” but the panel also is “trying to make sure that there are adequate protections so that it couldn’t serve as a vehicle for illegal or prohibited contributions to flood into the system.”
The FEC is one of the first federal agencies moving to issue guidance on the use of bitcoins, a significant step toward mainstream acceptance of the four-year-old online currency.
The experimental money is increasingly attracting the attention of technology investors and government regulators. The price of bitcoins hit a record high this week, topping $400 per coin — a surge driven in part by the decision last month of a major Chinese Web site to accept the currency.
FEC approval would be “yet more recognition from the federal government that bitcoin is a serious new technology that is here to stay and that people want to use in their everyday lives,” said Jerry Brito, senior research fellow at the Mercatus Center at George Mason University and director of its technology policy program. “Current regulation does not take into account anything like bitcoin, and so regulators are having to figure out how to apply existing rules and laws.”
Created by a still-unknown developer in 2009, the bitcoin network allows people to make nearly instantaneous online payments without going through a bank or a third party. The transactions are public, although the parties involved are identified only by their bitcoin addresses.
The freedom of the system has captured the imagination of entrepreneurs such as Cameron and Tyler Winklevoss, the investor twins who claim to have scooped up 1 percent of all bitcoins in circulation. But the currency also has garnered an unsavory reputation because of its use in illegal transactions on black-market Web sites.
FEC commissioners stressed Thursday that any political committees that accept bitcoins must be able to collect a contributor’s name and address, as with any other donation.
“Knowing how many ones and zeros are in the chain isn’t really helpful to us or to the public,” said commission Chairman Ellen Weintraub, a Democratic appointee.
The commission took up the issue in response to a request by the Conservative Action Fund, a super PAC financed largely by Alabama businessman Shaun McCutcheon, who is also pursuing a challenge to campaign contribution limits now before the Supreme Court.
source:http://www.washingtonpost.com/politics/got-bitcoin-fec-may-let-candidates-pacs-accept-the-digital-currency/2013/11/14/3dadc8a8-4c9a-11e3-ac54-aa84301ced81_story.html
