As the 2024 U.S. Presidential Election draws near, a growing number of political candidates are turning to cryptocurrency donations to fund their campaigns. This trend is becoming one of the most notable aspects of this election year, with several high-profile figures embracing digital currency contributions.
Donald Trump, the first presidential nominee to accept crypto donations, launched a specialized fundraising platform in May, allowing supporters to contribute via Coinbase Commerce. Similarly, Future Forward, a Democratic super PAC based in Palo Alto, California, has opened its doors to crypto donations, according to a Coinbase spokesperson.
Republican Senate candidate John Deaton, who is challenging incumbent Elizabeth Warren, has also expressed his openness to crypto contributions. Claire Hardwick, Deaton’s Communications Director, highlighted the campaign’s enthusiasm for support from the cryptocurrency community.
U.S. Senator Ted Cruz further fueled the trend by announcing in a recent interview on the Web3 Deep Dive podcast that his campaign now accepts Bitcoin (BTC) donations.
The Rising Appeal of Crypto Donations
The increasing popularity of crypto donations among political candidates is driven by several factors. Dennis Porter, Co-founder and CEO of the Satoshi Action Fund, a non-profit dedicated to educating policymakers about cryptocurrency, played a pivotal role in helping candidates like Robert F. Kennedy Jr. and Vivek Ramaswamy incorporate Bitcoin donations into their campaigns. Porter, who began assisting politicians with Bitcoin donations in 2020, sees the widespread adoption of crypto this year as a positive signal.
Porter believes that embracing crypto donations can encourage greater support from the digital currency community and potentially benefit candidates and their financial teams.
Advantages and Challenges of Digital Currency in Politics
Kara Calvert, Coinbase Vice President for US Policy, views cryptocurrency as the future of money, emphasizing its speed and cost-effectiveness. She pointed out that the focus on crypto donations this election season reflects the large number of Americans who lack access to traditional financial services.
Lee Bratcher, President of The Texas Blockchain Council, added that donating with crypto can offer potential advantages. While political donations are not tax-deductible, crypto donations may not trigger a taxable event, potentially reducing capital gains taxes if the donated crypto has appreciated in value.
Despite these benefits, Porter noted that candidates accepting Bitcoin donations often receive modest amounts, as many donors prefer to keep their Bitcoin and donate in dollars. However, he remains optimistic that as Bitcoin stabilizes and supporting infrastructure improves, politicians will see a more significant impact from crypto donations.
Porter also suggested that candidates could be motivated to pursue Bitcoin donations more actively by offering incentives, such as exclusive access or event tickets, and by developing financial products that allow candidates to borrow against Bitcoin rather than selling it.
The Growing Influence of Cryptocurrency in Politics
Cryptocurrency’s influence in politics extends beyond individual contributions to corporate political donations. According to a report from Public Citizen, a non-profit watchdog organization, cryptocurrency companies are responsible for nearly half of all corporate funding for this year’s election, with approximately $119 million raised from a wide range of contributors. Coinbase and Ripple alone account for over 80% of these donations.
Much of this funding is directed towards super PACs that support pro-crypto candidates. Fairshake, a leading bipartisan super PAC backed by prominent crypto companies, is among the top spenders in this election cycle.
As cryptocurrency continues to gain traction in political campaigns, it signals a broader acceptance of digital assets and a potential shift towards clearer regulations in the near future. This growing acceptance could further drive the adoption of cryptocurrencies, not only in politics but across various sectors.
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