Crypto Is the Hot New Trend for Donations This Election. Here’s Why
Crypto donations have emerged as a prominent trend in the 2024 US presidential election campaign.
Last month, Donald Trump became the first “major party Presidential nominee” to accept this donation form. He introduced a crypto fundraising page, allowing eligible donors to contribute using the Coinbase Commerce product.
Meanwhile, President Joe Biden’s re-election team is also reportedly considering accepting crypto donations for his campaign.
Both candidates seem eager to show their awareness of crypto-related issues and to support an industry currently disappointed in the US’ regulatory enforcement approach.
Not too long ago, Trump was anti-crypto. In 2019, he made his disapproval clear, calling them “not money” and criticizing their volatility and lack of real value. He also argued that these assets could be used for illegal activities like drug trafficking.
So why is he on board with it now? Experts across fields explained why these candidates are jumping on the crypto donation trend.
Crypto Donations Provide Privacy and Modern Appeal
New York Times best-selling author Deborah Perry Piscione said the move is similar to President Barack Obama using social media to raise donations in his first campaign.
“Taking crypto for political contributions is hip when you are 78 years old,” she said. She added that crypto donations offer privacy benefits, although campaigns must report donor information for contributions over certain amounts. Even though regulations around crypto donations are still changing, Trump will be remembered as the first presidential candidate to accept them, she pointed out.
Piscione, co-author of the book “Employment Is Dead: How Disruptive Technologies Are Revolutionizing the Way We Work” (HBR Jan. 28, 2025), mentioned that she advised another presidential candidate and pushed for them to accept crypto donations too.
Crypto Allows Politicians to Tap into Diverse Voter Base
Meanwhile, Jared Grey, CEO at Sushi Labs, explained that crypto helps politicians reach a wide and growing group of diverse voters. It also adds transparency to the fundraising process.
“By accepting cryptocurrencies for fundraising, politicians understand this innovative technology’s impact on the future of payments,” Grey said.
Further, donors might avoid paying capital gains tax on Bitcoin when donating directly in crypto.
Michal “Mehow” Pospieszalski, CEO of MatterFi, explained that in the US, crypto donors don’t pay capital gains taxes on contributions to 501(c)(3) organizations. This tax would apply if they sold the crypto first and then donated the proceeds.
Tax Benefits and Compliance Hurdles
Steffo Shambo, CEO of Shambo Consulting, further added that from a tax standpoint, the IRS treats crypto donations like property or stock donations. If donors have held the crypto for over a year, they can claim a deduction for its fair market value without paying capital gains tax. This could be a big benefit for early crypto investors.
However, for the campaign, crypto donations might bring extra accounting and reporting challenges to stay compliant with campaign finance rules. Both donors and campaigns need to carefully document these transactions and consult with tax professionals to navigate this new area.
