Can Cryptocurrencies Be Leveraged For Campaign Donations in 2022?

Time Stamp: June 15, 2022 12:58 AM
Source Node: 1380507

Cryptocurrencies Campaign Donations

Owing to the persisting boom in the use of cryptocurrencies, donations in the interest of political campaigns are becoming exceedingly popular. Despite this type of donation being prevalent earlier, the standardized and organized structure of such donations and their scale have risen drastically in the recent past. For instance, campaign finance has become a much larger life phenomenon. It is fascinating to note the intertwining of crypto and politics. What’s more? Cryptocurrencies are protected through cryptography, making them foolproof and quite reliable for campaign donations today. The Federal Election Commission Regulations Regarding Campaign Donations  Cryptocurrency is the new normal and how the Federal Election Commission regulates the use of crypto in campaigns contributes majorly to its use. Crypto donation platform called Crowdpac was launched in 2014 but clocking it in is tedious. These assets need to be converted to dollars before they become ready to spend. This process, in turn, incurs a processing fee, thereby reducing its cost-effectiveness. In that sense, crypto donations prove to be more complex in contrast to their cash and credit counterparts. The assets’ administrative, financial, and logistic hassles are a cause of concern. In recent progress, the White House urged all agencies across all government entities to look closely into the shortcomings pertaining to the use of crypto assets. Still, the on-ground approach lacks a clear motive and direction. Once these virtual assets become a more common sight in the public financial ballgame, one can expect a significant shift in their political role. Are There Any Federal Election Commission Guidelines?  FEC requires receipts in reference to each transaction to be kept safely in order to be accessible and followed throughout the system. This receipt contains details like name, employer, etc. Despite cryptocurrencies being the new normal, their mandatory conversion to dollars adds burdens like fees, extra time, and a lot of paperwork. Democrats Vs. Republicans  While Republicans seem to be consensual on the indulgence of crypto in the political scene, Democrats are more divided. The likes of Elizabeth Warren and Sherrod Brown have often been found reflecting on the disparity the use of crypto brings with it. The rich benefit far more. This debate also raises the question of the climatic consequences of crypto mining and the massive use of electricity that steers the process. Many believe that the role of cryptocurrency in political campaigns is at a cliffhanger right now. Looking at the negative aspects, a portion of the donation can get lost in the process of liquidation. This is in direct relevance to how volatile these assets are. What’s more? Crypto for donations proves to be more expensive for the candidates, and these donations wouldn’t be anonymous as well. Despite the disadvantages, the speed and transparency at which transactions through cryptocurrencies occur show immense potential in the area of campaign donations. The ultimate answer, however, will depend on the scale of crypto adoption.

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