Japan Okays Cryptocurrency Donation for Political Campaigns
Sanae Takaichi, Japan’s internal affairs and communications minister has made it clear that it is legal to donate cryptocurrencies to individual politicians and such contributions are not subject to the Political Funds Control Law, according to a report by Reuters Japan on October 8, 2019.
Japanese Authorities Greenlight BTC Donations
Japanese politicians can now take advantage of the borderless nature of bitcoin and other digital assets to raise funds for their political campaigns, as the government has made it clear that crypto donations are not against the law and they are not required to declare the exact amount of cryptos received from donors during their political campaigns.
Per sources close to the matter, Japan’s internal affairs and communication minister, Sanae Takaichi made the remarks at a press conference in the state on October 8.
Specifically, the minister stated categorically that crypto donations to individual politicians is not an illegal activity as it does not contravene the stipulations of the country’s Political Funds Control Law, which prohibits cash donations from businesses and corporate entities to individual politicians.
“Cryptocurrencies do not fall under any of the above regulations,” declared Takaichi.
For those who are unaware, Japan’s Political Funds Control Law was amended in 1994, as part of efforts to prevent collusion between corrupt politicians and businesses.
Another Forward-Thinking Move?
In 2017, crypto-friendly Japan became one of the first nations in the world to approve Satoshi Nakamoto’s bitcoin (BTC) as a legal tender, while also mandating all cryptocurrency exchanges in the region to come under the umbrella of the Financial Services Agency (FSA).
While some observers have argued that excluding cryptoassets from the Political Funds Control Law may give some corrupt politicians more room to leverage the anonymity that comes with cryptos to carry out their illicit practices, the minister has however hinted that the matter will be subjected to further deliberations by political parties and groups.
It’s worth noting that Japan is not the only jurisdiction where bitcoin and other distributed ledger technology (DLT) powered virtual currencies are accepted in political donations.
However, the U.S. Federal Election Commission, for instance, mandates all crypto recipients (politicians or political committees) to value the contribution based on the price of bitcoin at the time it was received and make appropriate declarations concerning the funds.
With Japan’s 2021 presidential election fast approaching, it remains to be seen whether the Political Funds Control Law will remain as it is.