Taxes & Crypto: Colorado To Become First State To Accept Digital Currency for Payments
Colorado proved to be on the cutting edge of cryptocurrency when governor Jared Polis tweeted that his state would be the first to accept cryptocurrency for payment of state tax and fees. He wrote, “We are getting a payment provider to accept crypto equivalent and deposit the dollars into the state’s treasury for that amount. It is kind of like credit card payments, with the bonus that there are no returned payments!”
In an interview with CNBC, Polis said he expects the program to start by this summer and that the program could pave the way for the state to accept crypto for other state charges, including driver’s license and hunting license fees.
The governor’s press secretary, Conor Cahill, called the program the state’s “next logical step on the path to digital statehood,” in a statement to The Guardian. “Governor Polis is proud to lead efforts to create a strong and dynamic crypto ecosystem that puts Colorado at the forefront of digital innovation,” Cahill wrote.
Twitter users had mixed feelings about the announcement, with some decrying the move because the use of energy-hungry crypto could accelerate climate change while others called crypto “a pyramid investment scheme.”
Other users pointed to the volatility of the crypto market as a stumbling block, pondering whether the extreme volatility will impact state revenue and taxpayer liability.
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Although Colorado is the first state to accept crypto for government payments, Wyoming and Arizona are also spearheading efforts to bring crypto into the mainstream. Arizona has proposed to recognize bitcoin as legal tender, while Wyoming is seeking to allow crypto sales tax payments from merchants in the state, Politico reported.
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