Kansas Puts a $100 Cap on Crypto Donations
- Based on previous legislation, there are no specific rules governing crypto donations in Kansas.
- Several US politicians profited from Bankman-Fried’s donations.
- Bloomberg reports that $580,000 in cryptocurrency was given to a number of political candidates for the 2022 election cycle. There’s a chance that it was higher.
With US lawmakers and regulators cooking up new policies to regulate crypto activities in the country, the Kansas state legislature is seeking to amend its campaign finance laws and introduce a new law that would impose a cap of $100 on cryptocurrency donations for both primary and general elections in the state.
Should the proposal be approved, this cap would be determined by the “fair market value” of the cryptocurrency at the moment it is received by the payment processor. The bill also advocates for tougher restrictions on the use of cryptocurrency in Kansas political campaigns. For example, political campaigns would not be permitted to use cryptocurrency or keep it as an investment for an extended period of time.
The new policy states that cryptocurrency donations must be promptly converted into U.S. dollars and transferred into the campaign account. The new rule limits not only the size of donations but also the use of cryptocurrency. It also mandates that political organizations conduct thorough research on the management of cryptocurrency donations. Also, the bill could require recipients of crypto donations to provide the donor’s name, physical address, and proof that they are not foreign nationals.
According to the proposed regulations, cryptocurrency donations might only be accepted if they originate from a U.S.-based cryptocurrency payment processor. So, processors are advised to use procedures that confirm the true identity of the donor.
Campaigns were instructed to stop collecting cryptocurrency donations in 2017 while the Kansas Governmental Ethics Commission looked into the idea. The Kansas campaign finance legislation amendments were introduced on January 25, and a hearing on the proposal was set for Tuesday.
Despite Kansas City’s reservations about crypto donations, several US lawmakers have benefited from them. For example, disgraced FTX founder and former CEO Sam Bankman-Fried was believed to have donated as much as $40 million to both Republicans and Democrats. Bankman-Fried’s donations have become controversial as the new FTX management team has requested that such donations be returned.
Lawrence has covered some exciting stories in his career as a journalist, he finds blockchain-related stories very intriguing. He believes Web3 will change the world and wants everyone to be a part of it.
