State Politics

Will Bitcoin be NC's new political money?

Bitcoin Believers

While regulators debate the pros and cons of bitcoins, the rising real-world value of this digital currency inspires the question: What makes money, money?
Up Next
While regulators debate the pros and cons of bitcoins, the rising real-world value of this digital currency inspires the question: What makes money, money?

Put away the credit card. Cryptocurrency donations may be the latest innovation in political money.

Emmanuel Wilder, a Republican running for a state House district from Wake County, has asked the State Board of Elections and Ethics Enforcement for formal guidance on accepting cryptocurrency to fund campaigns.

Cryptocurrencies — the most well-known is Bitcoin — are digital exchanges that operate without a central bank.

"I know that this is new, but there is a great opportunity to show that North Carolina is truly open to new emerging markets," Wilder said in an email to the elections board.

No contributors have asked to donate to his campaign using cryptocurrency, Wilder said in an interview, but he wants donors to have that choice. The Federal Election Commission in 2014 allowed campaigns for federal office to accept Bitcoin donations.

"I think having the option is important, not only for giving choice to people, but supporting this new upcoming financial service," he said. Wilder is seeking an opinion on cryptocurrency in general, and not just on Bitcoin, he said, because there are many other types of digital currency.

The elections board's general counsel is reviewing Wilder's request, and Executive Director Kim Westbrook Strach will issue a written opinion as soon as possible, agency spokesman Patrick Gannon said in an email.

Bitcoin is not completely anonymous because transactions can be traced to IP addresses. Other cryptocurrencies, however, promise greater anonymity.

A spokeswoman for campaign finance watchdog Democracy North Carolina said the organization hasn't looked at the issue in detail, but state regulators should carefully consider whether donors' identities will be disclosed as required.

"Since Bitcoin and cryptocurrencies make it possible for money to be transferred without any personally identifying information, one of the things the State Board should carefully consider is whether it’s possible for candidates to receive campaign donations via cryptocurrency while also complying with state disclosure requirements," Jen Jones wrote.

"While the Federal Election Commission has issued guidance permitting contributions in cryptocurrency in certain circumstances, the state of Kansas last fall declined a request to accept these contributions in state and local races," Jones said.

Learn how the crytocurrency Bitcoin works.

Wilder, a systems analyst at Red Hat, is running in House District 41 against incumbent Democrat Gale Adcock.

Wilder said he's heard concerns about dark money and foreign money coming into campaigns via cryptocurrency, but "we're at the point where we have to try to figure it out."

"I'm willing to be the first person to work on it."

In his email to the state board, Wilder highlighted some of the issues the FEC addressed in its advisory opinion on Bitcoin:

  • A campaign treasurer is responsible for reviewing contributions received for evidence of illegality and for determining whether they exceed limits on contributions.
  • Within 10 days of receiving a contribution, a treasurer may return it to the donor; otherwise, a treasurer must deposit it into a campaign depository.
  • If, after deposit, the contribution cannot be determined to be from a legal source, the treasurer must refund it within 30 days of the receipt of the deposit or the discovery of the illegality.
  • A political committee should value a contribution based on the market value of the cryptocurrency at the time it's received.
Lynn Bonner: 919-829-4821; @Lynn_Bonner

Related stories from Raleigh News & Observer