In a move to become mainstream and what looks like an attempt to keep an active presence in regulatory circles, Coinbase has established a Political Action Committee (PAC) with plans to raise money and spend it on US elections. The filings were recently made available by Federal Election Commission which revealed details of Coinbase’s Political Action Committee.
Coinbase PAC: Details of the filing
As per the filings, The PAC is allotted ID: C00680355 and its status are “ NONQUALIFIED – UNAUTHORIZED”, which according to legal definitions, refers to committees who have not qualified for multicandidate status – which means the PAC, as of now don’t have any restrictions on contribution to per candidate.
To qualify as a multicandidate status, a nonqualified committee must:
- Be registered with the FEC for at least six months;
- Receive contributions from at least 51 persons
- Contribute to at least five federal candidates, which over time Coinbase would soon achieve.
As per the filings, The PAC hasn’t raised or spent any money as on June 30, 2018. The contribution size current states $200 and under.
One interesting fact, with regards to the timeline of this, that comes out from the forms and other documents submitted is that Coinbase’s date of filling the first statement of organization (FEC Form 1) was 4th June 2018 signifying that the company had been planning this for a couple of months. Although this first application couldn’t clear the Commission’s preliminary review as it failed to identify the type of connected organization Coinbase was creating this PAC with.
The company has revised its application and filed an amendment on 10th July 2018 and this one seems to be have been approved.
The documents could be found here.
PAC: A tool to work with government policies and political candidates
The primary motive for a business to form a “connected” PAC, what Coinbase has created, is to contribute money that signifies the company’s interest in one or more political candidates. Under US federal law, corporations cannot donate straight to candidates in federal elections. If one wants to make company-oriented contributions, it has to be through a political action committee.
PACs are allowed to determine when to whom, and how much they give (subject to legal limits), but donations are public information that is observed by candidates and other groups. Deciding on which candidate(s) to give money to can create some agonizing and heated reactions along with problems if the non-supported person wins the election. Giving to candidates in only one party can raise similar problems when the other party is in power, which is why many PACs give to candidates in both parties, even if one party doesn’t completely represent its interests.
PAC contributions may help to open the door for a business to get in touch with elected officials and explain concerns about legislation or regulations but this is often implied by critics as political contributions to buy an elected official’s vote.
Is Coinbase exploring the legal route to get regulation in place for cryptocurrencies? Well, a lot of questions arise, but only time will tell the real strategy and intention of Coinbase’s step.