California will allow politicians to accept Bitcoin for campaign purposes

California has established a new law that allows state and municipal political candidates to accept bitcoin donations.



According to the LA Times, the new rule, which will go into effect in 60 days, was passed after the state's Fair Political Practices Commission approved the new requirement on July 21.

The new regulation allows candidates to accept crypto donations if they can quickly convert the digital assets into currency.

The law requires the candidate to cooperate with a registered cryptocurrency processor to complete the transaction.

The processor must also follow important Know Your Customer (KYC) requirements, such as gathering the contributor's name, address, occupation, and employer.

Previously, the state, along with the other eight states, disallowed crypto donations. Washington, D.C. is one notable state that allows political crypto donations.

Notably, lawmakers vying for federal office can now accept cryptocurrency donations.

Most states have been divided on legalizing crypto donations for political campaigns, citing issues including as transparency, market volatility, and a lack of laws.

Previously, the Federal Election Commission of the United States issued a warning against Bitcoin political contributions.

Part of the email says that committees can get Bitcoin if the asset is liquidated.

The FEC, on the other hand, stated that holding Bitcoin does not relieve political organizations of their need to return the donation if it comes from an illegal source and exceeds the contributor's contribution limit.

Since 2014, bitcoin donations have been permitted in federal elections, according to the FEC. However, some state governments have objected to the idea, passing legislation prohibiting contributions.

According to the commission, political organizations shall assess digital currency contributions based on the market value at the time the donation is made.

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