A bill drafted last week in the Tennessee State Legislature proposes that political candidates be allowed to accept digital currency contributions and seeks to revise related laws to include digital currency.
The bill was proposed by Steven Dickerson, a Republican of the Tennessee Senate.
First and foremost, the definition of “contribution” is to be revised as “any advance, conveyance…payment, digital currency, gift, or subscription of money or like thing of value…” Technically, digital currency does already fall under the definition of at least one of the more than dozen terms used to describe value. Nonetheless, Dickerson felt that explicit mention should be made.
While digital currencies have not been previously prohibited for political contributions, the lack of explicit mention until now suggested a legal grey area.
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The bill goes on to its main argument: “A candidate or political campaign committee is allowed to accept digital currency as a contribution. Digital currency shall be considered a monetary contribution with the value of the digital currency being the market value of the digital currency at the time the contribution is received.”
Though it would be considered a monetary contribution, its increase in value relative to fiat needs to be reported as interest in the filing of contribution, loan and expenditure statements.
Notably, the third section of the bill states that candidates would be obligated to sell the digital currency and deposit proceeds into a campaign account prior to spending them. This would prevent them from spending their bitcoins as bitcoins in venues where they are accepted. It would also require them to enlist the services of an exchange or brokerage, which may be a risky proposition for some.
Tennessee is not currently one of Coinbase’s 24 states or territories where it is licensed as a money transmitter.