Members of Congress are required to disclose many details about their personal finances.
Jared Polis, a Democratic U.S. Representative from Colorado—and a successful Internet entrepreneur—contends that elected representatives and certain staffers should also be required to disclose cryptocurrencies like Bitcoin and Ethereum, even though that’s not necessarily happening now. Polis wants it to become a clear requirement.
In a Feb. 5 letter to the House ethics committee, Polis writes, “It is clear that the existing disclosure laws and requirements adequately cover virtual currency.” He urges the committee to provide guidance so that members and their staffers disclose their virtual currency deals in the same way they disclose their transactions involving stocks, bonds, commodities, or other securities.
“The increasing use of cryptocurrency as an alternative to traditional payments and investments necessitates Congress take appropriate action to maintain transparency and deter potential conflicts of interest that may interfere with their representing the American people,” Polis says.
Bitcoin’s value has specifically been a point of note in recent months. Its value soared from less than $1,000 at the end of 2016 to more than $19,700 in December, according to data provided by CoinDesk. Since that peak, it has dropped by more than $10,000, and closed just above $8,200 on Feb. 7. Just this week, regulators have talked about placing more oversight on cryptocurrency, as concerns about scams, bubbles, and other troubles have increasingly been associated with it.
Polis made his fortune—he was rated the second wealthiest member of Congress in 2015 by the Center for Responsive Politics—in the 1990s by expanding the online presence of his family’s Boulder, CO-based greeting cards business, Blue Mountain Arts, which sold in 1999 to Excite@Home for hundreds of millions in cash and stock, as Xconomy has previously reported. He helped launch San Diego-based ProFlowers in 1998. Liberty Media acquired Provide Commerce, which operated ProFlowers as one of its brands, in 2006 for $477 million.
Techstars, the Boulder startup accelerator, may be the most recognizable company that Polis co-founded. The Colorado Democrat also invests in companies that run through the accelerator program, and discloses them in his financial reports.
Xconomy spoke briefly with Polis about his interest in requiring that cryptocurrencies be disclosed, as well as other tech-related work he’s doing in Congress. (This conversation was edited for brevity and clarity.)
Xconomy: What motivated your interest in it and why do you think it’s important?
Jared Polis: Members of Congress have very detailed disclosures about what we own. If a member of Congress buys a stock, or gold, or corn futures or anything, there is complete transparency. We have very high standards for elected officials and voters deserve to know what the personal economic interests of their elected officials are.
Cryptocurrencies are a bit of a gray area. I believe they should be disclosed like any other assets, whatever else a member of Congress owns, so that there’s that level of transparency to the public.
X: Why is that full disclosure important?
JP: The personal financial interests of members of Congress is really important information for the public to know to avoid any appearance of a conflict of interest or a real conflict of interest.
X: Is anyone resisting that push?
JP: It’s currently a gray area. There might very well be members of Congress who don’t disclose it. We want clear, unambiguous guidance that the Stock Act does include cryptocurrencies, which aren’t specified by name as an asset class but are an asset class like many others that are already disclosed. We don’t need a new law for this. We just need clarification from the ethics committee that members have a responsibility to report any cryptocurrency that they have.
X: There are no current requirements for the president, are there?
JP: I wish there was. I really wish there was. Congress sets its own requirement to the ethics committee. Unfortunately, the president of the United States is not subject to the ethics committee. It is important for people to know that senators and members of Congress have much more thorough and strict reporting requirements than the president of the United States.
X: What other work is going on in Congress related to cryptocurrency?
JP: As you know, I’m a sponsor of a bill with Rep. Schweikert (R, AZ) to exempt small transactions involving cryptocurrencies from the burden of IRS reporting. It removes costly compliance, and will help people use cryptocurrencies without the fears of IRS enforcement. It’s $600. There would be no reporting requirements at all. It would remove reporting requirements for all transactions under $600 for cryptocurrencies.
X: Are there currently any requirements for reporting cryptocurrency donations for campaigns?
JP: Yeah, there actually is. I was the first member of congress to accept Bitcoins for contributions. The federal elections commission failed to clarify the standards for accepting contributions. We were only allowed to accept contributions for up to $100 rather than the full $5,400 allowed with dollars under the law. The Federal Election Commission continues to fail to issue guidance with regard to Bitcoin contributions.
X: Would that also be something you’d like to see change?
JP: Yeah, the SEC has to do that. I’ve encouraged them to act in the past.
X: Why do you support cyrptocurrencies?
JP: I co-founded the blockchain caucus. We’re very excited to talk about opportunities to use distributed ledger technology for a lot of data-intensive applications, including health and financial transactions. Certainly, what cryptocurrencies offer is a lower transaction cost method of exchanging value between individuals in a transaction.
X: Are there any other areas in which you’re pursuing legislation or work that support startups or tech?
JP: There’s other areas that support tech. I would say I am doing a lot around open-source technology, both utilization within government as well as having practical impact, like reducing textbook costs for college students using open-source technology.
