The US Federal Election Commission (FEC) has given provisional approval to the ERC-20 token distributed by Omar Reyes as part of his campaign’s incentives program.
Right to Release OMR
The FEC has finished reviewing the politician’s coin project and stated in an advisory opinion letter that Reyes had the right to release the “Omar2020Token” (OMR). The Ethereum-based token is part of Reyes’ campaign to secure a Congressional seat and join the House of Representatives.
The elections regulator argued that as the OMR tokens are basically souvenirs and had no monetary value, Reyes’ campaign group can freely issue them as incentives to volunteers.
The letter further expounded that the tokens can’t be considered as compensation. It said the OMR tokens can be likened to the conventional modes of campaign souvenirs. It also noted that there was nothing in the FEC regulations that forbids a campaign council from issuing free souvenirs to its supporters or volunteers.
The draft letter was also clear that the Ethereum tokens can only be utilized as incentives. The Omar2020 campaign will allegedly end with prizes being awarded to the three top token holders. The campaign will delete its Ethereum contract and deal with the remaining OMRs once the campaign ends.
The FEC released an advisory opinion back in 2014 to address the issue of campaigns being financed with Bitcoin (BTC). At the time, the FEC stated that while campaigns can accept BTC donation, it should be in-kind, like a donation of services and goods. In short, BTC can’t be used in direct transactions. However, it can be converted to fiat money, deposited, and used for the campaign.