Cryptocurrency is everywhere – in Super Bowl ads, popular culture and now La Plata County politics.
District 1 county commissioner candidate Jack Turner appears to have established the first cryptocurrency campaign contribution program in Colorado. As cryptocurrency increasingly becomes a source of political donations, Turner hopes his program can serve as an alternative revenue stream while highlighting his approach to elected office.
“It might be very helpful for our campaign. I don’t know,” he said. “You don’t know if you don’t try.”
Cryptocurrencies are notoriously opaque with anonymous and private transactions, which has raised alarm among campaign finance groups.
According to Pete Quist, deputy research director of OpenSecrets, a Washington, D.C.-based nonprofit that tracks campaign finance and lobbying, cryptocurrency accounts are often identified only by usernames and their digital addresses on trading platforms.
This complicates the process when campaigns try to report their donations and can limit transparency.
“While campaign treasurers are required to report names and other identifying information about contributors, and to verify that contributors are legally permitted to give to that campaign, contributors using cryptocurrencies like Bitcoin must identify themselves to the campaign rather than that information coming from a regulated financial institution that has verified the contributor’s identity,” Quist said in an email.
“Essentially, disclosure of the source of cryptocurrency transactions is often reliant on the contributor being honest,” he said.
It would be illegal for a person to falsify their identity, Quist said, but the problem is campaigns must verify donations themselves rather than highly regulated banking institutions verifying that information in the cases of checking account or credit card donations.
Additionally, anyone can own multiple accounts on cryptocurrency platforms, which can make it more difficult for campaigns to identify contributions from the same source as required by Colorado campaign finance rules.
The Federal Election Commission first allowed political campaigns for federal office to accept cryptocurrency contributions in 2014. The ruling by the FEC specifically addressed Bitcoin and directed campaigns to value the contribution according to its market value at the time of the contribution.
In 2018, Colorado adopted rules allowing candidates to accept cryptocurrency contributions under former Secretary of State Wayne Williams.
Since the FEC’s ruling, cryptocurrency campaign donations have taken off. Candidates in California, Florida, Wisconsin and Illinois, among others, have begun accepting the digital contributions to fund their campaigns.
“We haven’t fully quantified (the growth of cryptocurrency campaign donations) yet, but we are definitely getting a lot more anecdotes about it than we have in past years,” Quist said in an interview.
Yet, many states have not established campaign finance regulations for cryptocurrency, Quist said.
The benefits of cryptocurrency for political campaigns are less clear, especially with the additional work that’s required of campaigns instead of financial institutions.
“The benefit here is a little bit harder to quantify. It’s probably just (that) crypto is ‘in’ right now,” Quist said.
Turner is no stranger to cryptocurrencies. He worked for Bittrex, the cryptocurrency trading platform that currently hosts an account for his campaign, in 2016 and 2017.
Turner’s cryptocurrency program outlines a series of rules that his campaign must follow both to comply with Colorado’s campaign finance regulations and to ensure transparency.
The state currently has only one rule dictating how cryptocurrency can be used for political donations. A candidate can accept cryptocurrency up to the limit for a cash or coin contribution, which cannot exceed $100, and the contribution is equal to the value of the cryptocurrency at the time of donation. A candidate must also report any gains or losses in the cryptocurrency as income or receipts.
Turner’s program also adds additional measures.
Colorado’s campaign finance rules allow anonymous contributors to donate up to $20, but every cryptocurrency donation to Turner’s campaign will require the legal name and address of the contributor. Turner will also report his cryptocurrency donations to TRACER, Colorado’s campaign finance tracker, with an explanation that the contribution was cryptocurrency.
Additionally, any contributions that are suspicious or violate Colorado campaign finance regulations will be donated to an Internal Revenue Service-recognized charitable organization within 30 days, in line with the state’s rules on anonymous contributions.
Turner has said that his campaign contribution program is the first in Colorado.
But Secretary of State Jena Griswold’s office could not confirm Turner’s campaign is the first to accept cryptocurrency.
In emails to Turner viewed by The Durango Herald, the Elections Division of the Secretary of State’s Office wrote that it had found no references to a previous cryptocurrency contribution in its records and Turner’s cryptocurrency campaign donation program appeared to be the first of its kind filed with the office.
The Elections Division noted that candidates could have previously accepted cryptocurrency but not noted the activity, treating the donation as cash.
Gov. Jared Polis has said he has accepted bitcoin contributions in the past, but it’s unclear how his campaign handled those contributions. Polis’ current donation page accepts only PayPal, Venmo or credit card donations.
Annie Orloff, a spokeswoman for Secretary of State’s Office, said cryptocurrency donations are treated like cash by Colorado’s campaign finance system making it difficult to differentiate between the two.
“Unless someone specifically adds a description, we just can’t tell,” Orloff said.
Reporting cryptocurrency donations as cryptocurrency rather than cash is in part why Turner developed his own program.
For weeks, Turner worked with the Elections Division of the Secretary of State’s Office to ensure that his campaign’s new cryptocurrency program was in lockstep with Colorado’s campaign finance regulations.
“I stand by the notion that we are really the first campaign to be so thoughtful, careful and diligent to comply with the letter and spirit of campaign finance regulations where cryptocurrencies are concerned,” Turner said in an email.
Turner hopes his foray into cryptocurrencies shows voters his approach as a county commissioner.
“There are a lot issues in the county that are similar (and) we constantly use the same solutions for the same problems,” he said. “Sometimes, I don’t think it served us well. We need to really think in a different way.
“Oftentimes in government and administration, we get so set in our ways that it’s very hard to change or hard to consider change,” he said. “You don’t necessarily have to change, but you have to be open to new ideas.”
With his cryptocurrency donation program, Turner also aims to highlight his skill set as a complex problem solver.
“One thing I want to demonstrate to the public is that we know how to take really complex problems and figure them out in a logical way that someone else can understand,” he said.
Turner faces a competitive race for District 1 county commissioner with Clyde Church, a Democrat, announcing his candidacy last week and Brad Blake, a Republican, also running for the seat.
Turner, who lost to Marsha Porter-Norton in the 2020 election for District 2, moved districts to run. He filed his candidacy in July 2021.
Turner’s campaign, which accepts the cryptocurrencies Bitcoin, Cardano, Ethereum and Tether, has so far accepted two of the donations, he said.
Whether Turner’s cryptocurrency bid will pay off for his campaign remains to be seen.
“The jury’s out on how effective it’s going to be. It could be just a heck of a lot of work for very little return,” he said. “But on the other hand, who knows?
With a laugh, Turner added: “I encourage everybody that trades cryptocurrency to go to our website and test it just to make sure it works. It’ll be a great contribution to the campaign industry.”
ahannon@durangoherald.com
