AO 2019-08: Campaign may distribute valueless blockchain tokens to volunteers and supporters
The Omar2020 committee may distribute valueless digital blockchain tokens to volunteers and supporters as an incentive to engage in volunteer activities.
Background
The Omar2020 campaign committee created 10,000,000 digital blockchain tokens to give as incentives for volunteers and supporters to host events, conduct voter registration and perform other campaign support activities. The tokens have no monetary value and cannot be sold or used to purchase goods or services. After the campaign concludes, volunteers and supporters may keep the tokens as campaign souvenirs in their "digital wallets."
Analysis
Under the Federal Election Campaign Act (the Act) and Commission regulations, the value of individual volunteer services provided to a political committee without compensation is exempt from the definition of contribution. If services are rendered for compensation, they must be paid for by the committee at the usual and normal rate. If paid at less than the usual and normal rate, then the difference between the usual and normal rate and the amount paid will result in an in-kind contribution to the committee.
In this case, the Commission concluded that the distribution of valueless blockchain tokens is not a form of compensation for volunteers' services but rather a novel means for volunteers and supporters to show their support for the campaign. The Commission found the valueless tokens to be analogous to more traditional forms of campaign souvenirs, and concluded that nothing in the Act or Commission regulations would limit or prohibit their distribution.
Date issued: July 11, 2019; Length: 5 pages