Binge Read: Kickstarter, Crypto, and Disrupting Political Fundraising

Editor’s Note: At the end of each week, The Stacks rounds up the most important takeaways from campaign finance reporting around the country.

Candidates and companies alike have vowed to disrupt political fundraising and fix what they deem is a broken system. Apparently, it’s much easier said than done.

The Kickstarter for politics wanted to change how political fundraising worked. Now it’s dead. [Vox]

Venture-backed Crowdpac set out to create a Kickstarter for political candidates, a crowdfunding platform that would overhaul the current political fundraising ecosystem. But on Tuesday, the company announced that it will be closing next month. In the end, the startup failed where it had hoped to help, in raising funds: “It’s a death that speaks to how political organizing these days centers on partisanship — and how hard it can be to build a scaled business in politics, particularly one centered around crowdfunding, when you aren’t clearly aligned with one party.”

Crowdpac now only fundraises for liberal candidates, but was founded as a nonpartisan organization, and recently received backlash when Steve Hilton, the startup’s former CEO, joined Fox News as a host and began promoting Donald Trump.

Rep. Eric Swalwell Is Accepting Crypto Donations in Bid for US Presidency [coindesk]

On Thursday, blockchain firm The White Company announced that it would be providing the tech for crypto donations to Rep. Eric Swalwell to support his bid for the U.S. presidency in 2020. Swalwell will accept six supported cryptocurrencies (including The White Company’s native token White standard) through a dedicated web page.

Swalwell has expressed his support for technology by recently signing a letter to the IRS seeking more clarity on cryptocurrency tax rules. And for embracing technology in general: “Blockchain can change the world, if we let it. So much of our public life now exists online, and there’s no reason to believe we can’t extend this further into our democracy and our economy – from exercising our right to vote, to how we look at cryptocurrency.”

He’s One of the Biggest Backers of Trump’s Push to Protect American Steel. And He’s Canadian. [The New York Times]

Canadian billionaire Barry Zekelman, whose business is mostly in the United States, has a vested interest in the direction-setting of American protectionist policy. And in the first term of the Trump Administration, Zekelman Industries contributed $1.75 million to America First Action, a super PAC created in January 2017 by former Trump campaign aides, making them the biggest steel industry donor to Donald Trump’s affiliated political committees.

In doing so, did Zekelman (who doesn’t have U.S. citizenship) violate a ban on contributions by foreigners? While the FEC prohibits foreigners from “directing, dictating, controlling, or directly or indirectly participating in the decision-making process” related to any campaign contribution, including super PACs, Zekelman claims that he played no part in the decision to donate.

Follow Up: Campaign finance watchdog group, the Campaign Legal Center, “filed a complaint on Tuesday against [Zekelman] alleging that he violated a federal ban on contributions by foreigners when his United States-based company donated $1.75 million last year to a political committee supporting President Trump’s agenda.H

High-Dollar Donations Funded Bernie Sanders’ Policy Group A Year Before His 2020 Campaign [Buzzfeed News]

Last week, Bernie Sanders, who has spent decades decrying the campaign finance system, came under scrutiny when the Wall Street Journal reported the support he has received from outside groups despite blasting the practice as “corrupt and undermining of American democracy. This week, he comes under scrutiny yet again, this time for large donations: “More than a dozen high-dollar contributions funded Bernie Sanders’ policy institute the year before he launched his second presidential bid, including one donation totaling $100,000, according to tax forms filed this month with the Internal Revenue Service. The Sanders Institute, a progressive think tank founded in 2017 by the Vermont senator’s wife, Jane Sanders, raised more than $361,000 last year from a total of 13 large contributions ranging from $5,000 to $100,000, the tax filing shows.”

Bernie’s new approach to raising cash: ‘Grassroots fundraisers’ [Politico]

Despite the scrutiny, or perhaps in the face of it, Sanders and his campaign have changed their approach to big-money fundraisers, deciding to “hold in-person fundraising events where donors of all means will be invited and the media will be allowed.”

FEC approves free cybersecurity for campaigns despite influence concerns [Washington Post]

In late April, we wrote about how the FEC was faced with an important and divisive decision: whether or not to allow nonpartisan groups to offer political campaigns free cybersecurity services. This week, they finally gave us their verdict and “gave the go-ahead this week to a nonprofit organization seeking to offer free cybersecurity services to political campaigns, upending rules that typically consider such free services illegal campaign contributions.”

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