Texas Ethics Commission seeks pro-crypto rule for political contributions
On March 20th, 2018, the Texas Ethics Commission released an advisory opinion that certain cryptocurrency tokens like Bitcoin and Ethereum are not considered to be securities. This is a great development for crypto-based startups looking to raise funds in their home state. However, there’s still uncertainty about how this ruling applies to other cryptocurrencies like Ripple or Monero.
The “is cryptocurrency legal” is a question that has been asked many times. The Texas Ethics Commission seeks to change the rules for political contributions to include crypto-currencies.
The proposal, which was filed with the Texas Secretary of State, aims to address and clarify the reporting obligations for cryptocurrencies used in political donations. According to the paperwork:
“The new regulation allows candidates, elected officials, and political groups to receive bitcoin donations.” It doesn’t differentiate between other sorts of cryptocurrencies, such as Bitcoin.”
If permitted, bitcoin donations and contributions must be recorded as in-kind contributions or investments rather than as cash. This action “reflects how the Federal Election Commission (FEC), Internal Revenue Service (IRS), and Securities and Exchange Commission (SEC) regard bitcoin donations,” according to the Commission.
Political and governmental campaigns would not be allowed to spend cryptocurrencies directly, according to the plan, and will be required to sell cryptocurrencies before spending the revenues. However, the Commission made the following points:
“Filers would not be required to sell their bitcoin assets within a certain deadline under the regulation.”
Furthermore, the proposal aims to mitigate the significant volatility of cryptocurrencies by requiring filers to record the fair market value of each accepted coin at the time of receipt.
Every crypto donation will be lawful if the contributor certifies that he or she is not a foreign citizen. The new rule is proposed under Texas Government Code 571.062, which allows the Commission to make rules to administer Title 15 of the Election Code, according to the petition.
Cryptocurrencies are officially recognized under Texas business law.
Texas has passed two laws in the House of Representatives that encourage bitcoin blockchain usage.
Texas House Bills 1576 and 4474, according to Cointelegraph, were signed into law by Governor Greg Abbott, allowing the formation of a blockchain working group and amending the state’s Uniform Commercial Code to recognize cryptocurrencies under commercial law.
The Texas Ethics Commission has suggested a new regulation allowing government officials and lawmakers to accept Bitcoin (BTC) and other cryptocurrency donations.