This April 3, 2013 file photo shows bitcoin tokens in Sandy, Utah.
Unorthodox campaign, unorthodox campaign contributions.
A D.C. group looking to legalize marijuana via a ballot initiative next November is accepting campaign contributions made with bitcoin, an electronic form of currency popular among tech circles. With the move, the group, known as the D.C. Cannabis Campaign, becomes the first campaign in D.C. history and one of the few in the country accepting contributions made with the currency.
"You use currency in politics... this is the future," says Adam Eidinger, the D.C. activist behind the campaign to drop penalties on the possession of small amounts of marijuana. He says that bitcoins are merely another means to fund candidates and campaigns.
Bitcoin was first developed in 2009, and works as a peer-to-peer means to pay for goods and services while avoiding many of the fees imposed by credit card companies. Bitcoins are also exchangeable for traditional currency; coins can now go for more than $1,000. There are some 12 million bitcoins currently in circulation.
While bitcoins have been used both for legal and illegal transactions — the U.S. government recently seized $28 million worth of bitcoins associated with a website that sold drugs — their use in funding political campaigns is new. A Libertarian mayoral candidate in Cadillac, Mich. accepted Bitcoin contributions for his recent run — he lost — and Jim Fulner, another Michigan Libertarian, also said he would take the currency for his U.S. Senate run.
The possibility of bitcoins flooding into campaign coffers has some regulators worried, though few have yet to decide whether the practice is prohibited or would have to be specially regulated. The Federal Elections Commission recently took up the issue, though its members were unable to reach consensus on whether bitcoins should be accepted for federal campaigns. The issue will be taken up again next year.
Locally, a spokesman for the D.C. Office of Campaign Finance said that it was looking into the use of bitcoins for local campaigns. Eidinger says the matter is simple — they should be treated like any other in-kind contribution. "If you can accept a car in-kind... this is just another asset you're accepting," he says.
Still, bitcoins could pose some novel challenges for D.C. regulators, especially when it comes to determining what they're worth.
Whether in-kind or monetary contributions, D.C. places limits on how much individuals can give to campaigns for elected office: $500 to ward-based Council candidates, $1,000 to At-Large Council contenders, $1,500 to Council chairman hopefuls, and $2,000 to mayoral aspirants. Since the dollar-equivalent value of bitcoins can fluctuate, it remains to be seen how the Office of Campaign Finance would count bitcoins against individual contribution caps.
Though initiatives face no contribution limits, Eidinger says that he will account for the value of the bitcoins he receives — he's already gotten $25 worth — by calculating the value at the time they are contributed, though he admits that it may change if he converts them to dollars. He is also asking that any bitcoin contributor submit their name and address, just as cash, credit card or check contributors are required to when donating to D.C. campaigns.
Regardless, Eidinger says that the point is to push the envelope. "We're doing a disruptive thing here," he says. "We're going to be testing the water to see if it's allowed."