It has happened. The Californian government has decided to lift the ban that stopped state and local governments from raising funds with crypto. This four-year ban, put into action at the time of the previous bear market in 2018, was lifted thanks to a vote put forth by the state’s Fair Political Practices Commission (FPPC) last month.
Despite this annulment, a financial limit for a campaign is still in place for California. Moreover, though political campaigners can now raise and receive crypto donations, they must change it to fiat money immediately after receiving it.
The ban was initially accepted because the FPPC was worried about how campaign transparency could be affected if crypto was used. Hence, if any crypto donations are made to political campaigners, it needs to be done through a US-based crypto payments processor or another service that will put forth measures to ensure knowledge about where the money is coming from.
“In drafting this legislation, we had to address the inherent concerns with cryptocurrency and the opportunity it presents for illegal contributions,” said David Bainbridge, FPPC’s general counsel, in a meeting on Thursday.
There are, of course, some restrictions that have been put forth to ensure that anonymous donations do not interfere. They will be barred. The donator will go through a thorough information check, collecting their name, address, occupation, etc. However, anonymous donations to individual campaigners are still being debated.