By ANDREW SELSKY and STEVE LEBLANC, Associated Press<\/p>\n<\/div>\n
For congressional candidate Shrina Kurani, cryptocurrency is not only the future of money, it\u2019s a transformative technology that could revolutionize campaign funding and attract a new generation of voters.<\/p>\n<\/div>\n
She is among a vanguard of candidates courting campaign contributions in digital currencies such as Bitcoin.<\/p>\n<\/div>\n
\u201cWe are a campaign that is speaking to a large part of the population, especially younger people,\u201d said the American-born daughter of Indian immigrants, who is on Tuesday’s primary ballot as she seeks the Democratic nomination for a congressional seat east of Los Angeles.<\/p>\n<\/div>\n
Kurani\u2019s foray into digital currency to help fund her campaign would not be possible if she were running for the California Legislature or some other office within the state. While the federal government allows political donations in cryptocurrency, California does not, having banned the practice four years ago.<\/p>\n<\/div>\n
Political Cartoons<\/h3>\n<\/p>\n![](\"https:\/\/www.usnews.com\/object\/image\/00000181-2526-d795-af87-ef3efea40000\/20220602edjwc-a.jpg?update-time=1654197442402&size=responsive640\")
<\/div>\n<\/div>\n<\/div>\n\nThe difference underscores not just the rising popularity of cryptocurrencies but also how regulation varies widely across the U.S.<\/p>\n<\/div>\n
\nSome states, including Arkansas and North Carolina, also don\u2019t allow for cryptocurrency donations in state races under existing campaign finance laws. Others have followed federal rules for congressional candidates and allow donations with disclosure requirements and contribution caps, typically set at $100. Still other states, including Hawaii, Idaho and South Dakota, have adopted no specific policies around digital currency donations.<\/p>\n<\/div>\n
\nDigital currencies offer an alternative that does not depend on banks. Instead, transactions are validated and recorded on a decentralized digital ledger called the blockchain.<\/p>\n<\/div>\n
\nPerianne Boring, founder and CEO of the Chamber of Digital Commerce, a trade association representing the blockchain industry, likened the use of cryptocurrency in politics to former presidents Barack Obama using smartphone technology and Donald Trump leveraging social media.<\/p>\n<\/div>\n
\n\u201cBlockchain technology can increase participation in the political process in a very positive way,\u201d Boring said, noting that is particularly true for younger people and members of minority groups who might be skeptical of traditional monetary methods.<\/p>\n<\/div>\n
\nCritics say the potential downside is lack of transparency \u2014 not knowing who is ultimately behind the donation.<\/p>\n<\/div>\n
\nBeth Rotman, director of the Money in Politics and Ethics Program for the nonpartisan watchdog group Common Cause, worries that traceability is more difficult with cryptocurrency.<\/p>\n<\/div>\n
\n\u201cIn campaign finance, you want disclosure. You need backup information,\u201d Rotman said. \u201cI know (cryptocurrency) is sexy and signals to people that you\u2019re a hip new candidate, but there has to be a better way to do it than compromise the other parts of the campaign finance system.\u201d<\/p>\n<\/div>\n
\nTimothy Massad, a former chairman of the U.S. Commodity Futures Trading Commission, also is concerned about disclosures.<\/p>\n<\/div>\n
\n\u201cThe danger is that this is still, in my mind, a sector where there is insufficient regulation, particularly on the risk of illicit activity and money laundering,\u201d said Massad, currently a research fellow at Harvard University\u2019s Kennedy School of Government.<\/p>\n<\/div>\n
\nCryptocurrency donations have been permitted in federal races for years, after the Federal Election Commission allowed their use in a 2014 opinion.<\/p>\n<\/div>\n
\nThe commission said political committees should value digital currency contributions based on the market value at the time the donation is received. Candidates also must return contributions that come from prohibited sources or exceed contribution limits.<\/p>\n<\/div>\n
\nIn the 2017-18 election cycle, cryptocurrency donations reported to the Federal Election Commission came to just over $1.2 million. They have hit about $500,000 so far in the current cycle, which has months to go before the general election.<\/p>\n<\/div>\n
\nShortly after the Federal Election Commission allowed cryptocurrency donations, then-U.S. Rep. Jared Polis, a Democrat, began soliciting them. Now governor of Colorado, Polis is seeking similar contributions as he runs for reelection, with donations in cryptocurrency capped at $100.<\/p>\n<\/div>\n
\n\u201cThrough campaigns accepting cryptocurrency donations, we can show the security, accessibility and the opportunity of using crypto in different types of transactions and also help send the message that Colorado is a home of innovation,\u201d said Amber Miller, Polis\u2019 campaign spokesperson.<\/p>\n<\/div>\n
\nAs the popularity of digital currencies grows, some states that prohibited cryptocurrency contributions are reassessing.<\/p>\n<\/div>\n
\nJay Wierenga, spokesperson for the California Fair Political Practices Commission, said the agency will reexamine its ban later this year.<\/p>\n<\/div>\n
\n\u201cThe commission is always seeking to keep up with and get ahead of the changing universe around political activity,\u201d Wierenga said.<\/p>\n<\/div>\n
\nOregon is one of the more innovative states in elections, having been the first to institute vote-by-mail. But in 2019, Oregon banned candidates campaigning for offices within the state from accepting cryptocurrency donations. That was despite former Secretary of State Dennis Richardson, a Republican, saying they should be considered as \u201ca new and innovative way to expand participation.\u201d<\/p>\n<\/div>\n
\nTwo months after Richardson died of cancer in 2019, the Oregon Legislature closed the door to such donations. As the Senate prepared to vote, state Sen. Jeff Golden, a Democrat, said: \u201cOne of the widely shared objectives of this legislative session is to increase the transparency of money in politics, and cryptocurrency tends to go in the opposite direction.\u201d<\/p>\n<\/div>\n
\nThat feeling isn’t unanimous. One of the few state lawmakers who opposed prohibiting cryptocurrency donations was Republican Rep. Bill Post. He said a lot of people in the Legislature simply didn’t understand it.<\/p>\n<\/div>\n
\n\u201cI don\u2019t want (us) to sound like a bunch of old fuddy-duddies here,\u201d he said. \u201cLet\u2019s get up to speed on the 21st century.\u201d<\/p>\n<\/div>\n
\nJesse Grushack, 30, is one of those voters fond of cryptocurrencies and who supports using them for political contributions. The New Yorker donated to the campaign of Democrat Matt West, a fellow cryptocurrency enthusiast who had a failed bid for an Oregon congressional seat this year.<\/p>\n<\/div>\n
\n\u201cAt this point in American politics, anyone who\u2019s pro-crypto is someone I want to support,\u201d Grushack said.<\/p>\n<\/div>\n
\nKurani, 29, said her embrace of cryptocurrency is more than just a chance to display her tech credentials. It\u2019s also a way to reach those for whom the digital alternatives to U.S. dollars are becoming their legal tender of choice.<\/p>\n<\/div>\n
\nShe downplays concerns about donor secrecy, saying her campaign converts crypto donations into dollars and pursues the same information \u2014 name, address, employer, occupation \u2014 that it would for any donor.<\/p>\n<\/div>\n
\n\u201cWe are really making sure that we can represent American people who are participating with new kinds of digital currency,\u201d she said.<\/p>\n<\/div>\n
\nAssociated Press data journalist Camille Fassett in Oakland, California, and AP writers Audrey McAvoy in Honolulu; Stephen Groves in Sioux Falls, South Dakota; and Keith Ridler in Boise, Idaho, contributed to this report.<\/p>\n<\/div>\n
<\/div>\n<\/div>\n<\/div>\nThe difference underscores not just the rising popularity of cryptocurrencies but also how regulation varies widely across the U.S.<\/p>\n<\/div>\n
Some states, including Arkansas and North Carolina, also don\u2019t allow for cryptocurrency donations in state races under existing campaign finance laws. Others have followed federal rules for congressional candidates and allow donations with disclosure requirements and contribution caps, typically set at $100. Still other states, including Hawaii, Idaho and South Dakota, have adopted no specific policies around digital currency donations.<\/p>\n<\/div>\n
Digital currencies offer an alternative that does not depend on banks. Instead, transactions are validated and recorded on a decentralized digital ledger called the blockchain.<\/p>\n<\/div>\n
Perianne Boring, founder and CEO of the Chamber of Digital Commerce, a trade association representing the blockchain industry, likened the use of cryptocurrency in politics to former presidents Barack Obama using smartphone technology and Donald Trump leveraging social media.<\/p>\n<\/div>\n
\u201cBlockchain technology can increase participation in the political process in a very positive way,\u201d Boring said, noting that is particularly true for younger people and members of minority groups who might be skeptical of traditional monetary methods.<\/p>\n<\/div>\n
Critics say the potential downside is lack of transparency \u2014 not knowing who is ultimately behind the donation.<\/p>\n<\/div>\n
Beth Rotman, director of the Money in Politics and Ethics Program for the nonpartisan watchdog group Common Cause, worries that traceability is more difficult with cryptocurrency.<\/p>\n<\/div>\n
\u201cIn campaign finance, you want disclosure. You need backup information,\u201d Rotman said. \u201cI know (cryptocurrency) is sexy and signals to people that you\u2019re a hip new candidate, but there has to be a better way to do it than compromise the other parts of the campaign finance system.\u201d<\/p>\n<\/div>\n
Timothy Massad, a former chairman of the U.S. Commodity Futures Trading Commission, also is concerned about disclosures.<\/p>\n<\/div>\n
\u201cThe danger is that this is still, in my mind, a sector where there is insufficient regulation, particularly on the risk of illicit activity and money laundering,\u201d said Massad, currently a research fellow at Harvard University\u2019s Kennedy School of Government.<\/p>\n<\/div>\n
Cryptocurrency donations have been permitted in federal races for years, after the Federal Election Commission allowed their use in a 2014 opinion.<\/p>\n<\/div>\n
The commission said political committees should value digital currency contributions based on the market value at the time the donation is received. Candidates also must return contributions that come from prohibited sources or exceed contribution limits.<\/p>\n<\/div>\n
In the 2017-18 election cycle, cryptocurrency donations reported to the Federal Election Commission came to just over $1.2 million. They have hit about $500,000 so far in the current cycle, which has months to go before the general election.<\/p>\n<\/div>\n
Shortly after the Federal Election Commission allowed cryptocurrency donations, then-U.S. Rep. Jared Polis, a Democrat, began soliciting them. Now governor of Colorado, Polis is seeking similar contributions as he runs for reelection, with donations in cryptocurrency capped at $100.<\/p>\n<\/div>\n
\u201cThrough campaigns accepting cryptocurrency donations, we can show the security, accessibility and the opportunity of using crypto in different types of transactions and also help send the message that Colorado is a home of innovation,\u201d said Amber Miller, Polis\u2019 campaign spokesperson.<\/p>\n<\/div>\n
As the popularity of digital currencies grows, some states that prohibited cryptocurrency contributions are reassessing.<\/p>\n<\/div>\n
Jay Wierenga, spokesperson for the California Fair Political Practices Commission, said the agency will reexamine its ban later this year.<\/p>\n<\/div>\n
\u201cThe commission is always seeking to keep up with and get ahead of the changing universe around political activity,\u201d Wierenga said.<\/p>\n<\/div>\n
Oregon is one of the more innovative states in elections, having been the first to institute vote-by-mail. But in 2019, Oregon banned candidates campaigning for offices within the state from accepting cryptocurrency donations. That was despite former Secretary of State Dennis Richardson, a Republican, saying they should be considered as \u201ca new and innovative way to expand participation.\u201d<\/p>\n<\/div>\n
Two months after Richardson died of cancer in 2019, the Oregon Legislature closed the door to such donations. As the Senate prepared to vote, state Sen. Jeff Golden, a Democrat, said: \u201cOne of the widely shared objectives of this legislative session is to increase the transparency of money in politics, and cryptocurrency tends to go in the opposite direction.\u201d<\/p>\n<\/div>\n
That feeling isn’t unanimous. One of the few state lawmakers who opposed prohibiting cryptocurrency donations was Republican Rep. Bill Post. He said a lot of people in the Legislature simply didn’t understand it.<\/p>\n<\/div>\n
\u201cI don\u2019t want (us) to sound like a bunch of old fuddy-duddies here,\u201d he said. \u201cLet\u2019s get up to speed on the 21st century.\u201d<\/p>\n<\/div>\n
Jesse Grushack, 30, is one of those voters fond of cryptocurrencies and who supports using them for political contributions. The New Yorker donated to the campaign of Democrat Matt West, a fellow cryptocurrency enthusiast who had a failed bid for an Oregon congressional seat this year.<\/p>\n<\/div>\n
\u201cAt this point in American politics, anyone who\u2019s pro-crypto is someone I want to support,\u201d Grushack said.<\/p>\n<\/div>\n
Kurani, 29, said her embrace of cryptocurrency is more than just a chance to display her tech credentials. It\u2019s also a way to reach those for whom the digital alternatives to U.S. dollars are becoming their legal tender of choice.<\/p>\n<\/div>\n
She downplays concerns about donor secrecy, saying her campaign converts crypto donations into dollars and pursues the same information \u2014 name, address, employer, occupation \u2014 that it would for any donor.<\/p>\n<\/div>\n
\u201cWe are really making sure that we can represent American people who are participating with new kinds of digital currency,\u201d she said.<\/p>\n<\/div>\n
Associated Press data journalist Camille Fassett in Oakland, California, and AP writers Audrey McAvoy in Honolulu; Stephen Groves in Sioux Falls, South Dakota; and Keith Ridler in Boise, Idaho, contributed to this report.<\/p>\n<\/div>\n