AUSTIN, Texas — As polls continue to show Texas Attorney General Greg Abbott with a sizable lead over State Senator Wendy Davis, his Democratic opponent in the Governor’s race, Abbott is poised to become one of the first governors in the country to win an election accepting donations in the form of Bitcoin, a new, decentralized, completely digital “cryptocurrency” that has attracted increasing media attention and acceptance within consumer markets within the past year, leading Bitcoin supporters to hope that his campaign’s support of the new currency will lead to continued support from Abbott when he is in the Governor’s office.
The reported value of all Bitcoins currently in circulation is over four billion U.S. dollars, and it has become popular especially in the technology industry. Texas’ low-tax, low-regulation, business friendly environment is viewed as hospitable by Bitcoin entrepreneurs just like many other industries. Bitcoin Magazine recently dubbed the Lone Star State the “Future Headquarters of Bitcoin,” noting that Texas’ “booming technology sector that could take bitcoin to the moon,” and that Austin was one of the first cities to host an annual Bitcoin conference, held every March.
The article also notes that states like New York are considering passing regulatory restrictions that are opposed by Bitcoin users, and the environment in Texas has been far more receptive. Paul Snow, president of the Texas Bitcoin Association, is among those who see a bright future for Bitcoin in Texas. “As a Bitcoin enthusiast living in Texas,” Snow said, “I am encouraged when our leaders and representatives support Bitcoin and encourage the development of technologies based on [this currency.] Keeping regulations reasonable will insure Texas will be at the center of developing this new technology.”
As Breitbart Texas previously reported, Abbott began accepting Bitcoin donations earlier this year and added a separate button on his website for Bitcoin donations. In his statement announcing he was accepting the new currency, Abbott tied his enthusiasm for it to his support for other technological innovation in Texas. “I made the decision to accept Bitcoin because I believe that it represents the free-market economic principles that make Texas a national leader in innovation and entrepreneurship,” said Abbott. “As Governor, I will keep taxes low, government small and reduce regulations so Texas’ booming technology sector will continue to flourish.”
The Abbott campaign confirmed to Breitbart Texas that they had received several Bitcoin donations so far, but did not have a total value as of press time. Abbott’s Communications Director Matt Hirsch told Breitbart Texas, “While we don’t expect Bitcoin to become our main source of campaign contributions, we’re excited be able to give supporters in the Bitcoin community the option to contribute in this way. Our campaign has focused on making use of cutting-edge tools to communicate online and has made digital a priority from the start. Something as innovative as Bitcoin is an opportunity for us to continue this focus, particularly given the fact that it embodies free market principles, which Texans are very fond of.”
One interesting issue is the valuation of these donations. Texas law allows political contributions in the form of either U.S. currency or in-kind donations of assets, and since Bitcoin is not official U.S. currency, any donation in the form of Bitcoin will be valued at the current market value at the time of the contribution. Because the value of Bitcoins fluctuates — according to coindesk.com, the value peaked at over $600 in July and has been around $300 to $400 for the past month — the actual value to the Abbott campaign could vary widely from reported value, depending on when the campaign actually seeks to turn them into U.S. dollars. Former Federal Reserve Chairman Alan Greenspan is among those who are highly skeptical of Bitcoin’s intrinsic value, dismissing it as a “bubble” and saying that “there is no fundamental issue of capabilities of repaying it in anything which is universally acceptable” in an interview with Bloomberg Television last December. On the other hand, support from prominent political candidates like Abbott could help bring legitimacy to this new digital currency, and help stabilize its real world value.
Follow Sarah Rumpf on Twitter at @rumpfshaker.