JAKARTA— The Texas Ethics Commission proposed new rules that allow government officials and politicians to accept Bitcoin (BTC) and cryptocurrency contributions.
The proposal was submitted to the Texas Secretary of State, who seeks to address and clarify the reporting requirements of political contributions made with cryptocurrencies. According to the submission:
“The new rules allow candidates, officials and political committees to accept cryptocurrencies. It doesn't differentiate between all types of cryptocurrencies, like Bitcoin."
If approved, cryptocurrency donations and contributions need to be reported as contributions in kind or as investments, not currency. According to the Commission, this move “reflects the way the Federal Electoral Commission (FEC), Internal Revenue Service (IRS) and Securities and Exchange Commission (SEC) treat cryptocurrency contributions.”
The proposal clarifies that political campaigns and governments will not be allowed to spend cryptocurrencies directly and will need to liquidate cryptocurrencies before spending the proceeds. However, the Commission stated:
“The rules will not require whistleblowers to liquidate their cryptocurrency holdings within a certain period of time.”
In addition, the proposal plans to counter the high volatility of cryptocurrencies by directing whistleblowers to report the value of cryptocurrencies received as fair market value at the time of receipt.
The legality of each crypto contribution will be determined by confirming that the donor is not a foreign national. According to the filing, new rules are proposed under Texas Government Code 571,062, which authorizes the Commission to adopt rules to administer Title 15 of the Electoral Code.
The state of Texas recently approved two house bills promoting the adoption of cryptocurrency blockchains.
According to a Cointelegraph report, Texas House Bills 1576 and 4474 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.
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