The Bitcoin Voters PAC (BVPAC) — a super PAC intending to receive and spend money entirely in Bitcoin — opened its doors on Jan. 6, and promptly closed them just two days later. Its website, bitcoinvoterspac.org, now states:
Due to the new compliance issues at the state level, we are unable to continue operations at this time. We would like to thank the FEC for their acceptance of bitcoin addresses instead of a bank account for deposits. While we could just take dollars and continue, the decision is to wait until someone with better legal representation argues that bitcoin should be allowed for expenditures as well.
Thanks to those who helped with this project. I think we have demonstrated that there is at least some will among American voters to spend their bitcoins in campaigns.
Bitcoin is a digital currency whose minting and circulation is governed by a public, decentralized network of computers and standards (much like the Internet itself). No single entity controls Bitcoin, and transactions are designed to be recorded in a public ledger and can be reliably made without exposing sensitive details (such as credit card numbers). These characteristics are possible because Bitcoin's underlying architecture is based on the same kinds of cryptographic principles that make up the World Wide Web. Timothy Lee has a great Bitcoin FAQ over at the Washington Post.
The creator of BVPAC is Richard Wagner, a 46-year old elementary school science teacher from a suburb of Madison, Wis. Reached by phone, Wagner describes himself as a "moderate Democrat" who came across the Bitcoin community in 2011. Wagner initially assumed Bitcoin was a sort of Ponzi scheme, but became an enthusiastic Bitcoin user after reading the original Bitcoin paper — even going so far as to buy woollen alpaca socks from a well-known Bitcoin-accepting alpaca farm.
Wagner's BVPAC is notable for being the first super PAC to file with the Federal Election Commission and list Bitcoin wallet addresses (see page 6 of the filing). In November, the FEC issued a draft opinion on Bitcoin, saying that committees "may accept Bitcoins as in-kind contributions", but must sell them rather than directly spend them. That opinion has not been finalized, thanks to a partisan deadlock at the FEC, but Rep. Steve Stockman's campaign committee isn't waiting, and has already begun accepting Bitcoin.
Shortly after the FEC's draft opinion, bitcoinvoterspac.org was registered on Dec. 8, its FEC application mailed off by Dec. 26th, received by the FEC on Jan. 2, and issued a committee ID by the FEC in time for BVPAC's press release on Jan. 6.
That press release describes its mission as promoting Bitcoin itself. Wagner says he also planned to use the super PAC to experiment with less centralized methods of campaign planning. For example, one idea was to crowdsource messages to display on crowdfunded billboard space — all paid for using a decentralized cryptocurrency.
Wagner decided to shut BVPAC down after becoming aware of the uncertainty of compliance at the state level, especially the matter of how to pay for state filing fees using only Bitcoin. (Filing with the FEC does not entail a fee.) And, though the FEC issued the BVPAC a Committee ID, that doesn't necessarily mean they performed a full review on BVPAC's compliance. While BVPAC won't formally be shut down until a Notice of Termination is filed, BVPAC's wallets have already been destroyed, as there would be no easy way to refund Bitcoin donations if they were made to the wallets BVPAC had listed.
The Bitcoin Voters PAC was short-lived, and ultimately took in 0 BTC. But this elementary school teacher's impulsive political experiment certainly made an effective demonstration of just how easy it is to use Bitcoin to push the boundaries of federal election law.
(Jacob Fenton also contributed to this story.)