Starting today, Ohio will become the first state in the United States to embrace cryptocurrency. The Ohio State Government will now accept taxes from businesses in the form of bitcoins, reports WSJ. They have opened a cryptocurrency portal – ohiocrypto.com which enables companies to register under this new initiative. The idea was conceived by Josh Manel, Ohio State Treasurer in an effort to make tax payments instantaneous, transparent and secure.
The move is intended to boost the ambitions of the state to remake itself as a more tech-friendly state. Ohio is home to one of the largest venture capital funds in the midwest, Drive Capital. And this comes right off the heels of the announcement of rebranding Cleveland from “Believeland” to “Blockland”. The Blockchain Initiative hopes to develop a local economy based on blockchain technology — the software behind cryptocurrencies like Bitcoin.
Businesses will be able to pay 23 different types of taxes via this new system, ranging right from cigarette and tobacco taxes to fuel and sales taxes. One thing to note is that the Government wouldn’t be accepting the bitcoins directly but rather through a broker – BitPay. BitPay is a cryptocurrency payment startup which provides a platform where users can buy and transfer bitcoins. And BitPay converts them into dollars or any other currency at a 1% processing fee and transfers this amount to the end user. In this case, the seller being the businesses and the end user being the Government.
The move by Ohio Government is hardly expected to combat the current imploding market of bitcoin which collapses to a new low of $3600 per coin. It at least gives the market of cryptocurrency Government’s validation, which has lacked so far. Even other states such as Arizona, Georgia, and Illinois contemplated similar strategies. But the bills never got passed by their respective state legislatures.