Arizona Could Allow Its Residents to Pay Taxes Using Cryptocurrencies

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Some of the most important US states are starting to look into cryptocurrencies. Arizona could be the first US state to allow its citizens to pay taxes using Bitcoin and other cryptocurrencies. A new legislation (Senate Bill 1091) that is being analysed would be the first of its kind in the United States.

Arizona Tax Payers May Use Cryptocurrencies

Cryptocurrencies have been taking an important step into the daily life of many individuals all over the world. They can become more legitimized if states and public entities start to accept them as a means of payment. With this new legislation, Arizona could send signals to other states in the US or other countries.

Arizona Signal: ‘The Grand Canyon State Welcomes You’

One of the sponsors of this bill, Jeff Weninger, commented about it:

“This is one of the many bills we use to send signals to everyone in the United States and possibly around the world that Arizona will be a place for Blockchain technology and digital currency.”

Bitcoin and other cryptocurrencies will be used in order to pay the taxes. The government will convert the cryptocurrencies received to United States dollars in the next 24 hours. After it, the taxpayer will be credited with the converted dollar amount.

The text of the bill reads as follows:

“A payment gateway, such as bitcoin or other cryptocurrency, using electronic peer-to-peer systems. The department shall convert cryptocurrency payments to United States dollars at the prevailing rate within twenty-four hours after receipt and shall credit the taxpayer’s account with the converted dollar amount.”

Other governments have been working with blockchain technology. Several countries in the world have blockchain projects being developed. Blockchain technology is not only used to power cryptocurrencies but it is also used to register IDs, track shipments, send smart contracts and develop less corrupt and more transparent voting systems.

Bitcoin Volatility

Some important enterprises that were accepting cryptocurrency payments and Bitcoin, now have decided to stop them. The reason behind that is that the market is really volatile. Furthermore, Bitcoin has been suffering of high fees and slow transaction times. As more individuals use Bitcoin, the network becomes more congested.

Other cryptocurrencies have been increasing in popularity among merchants. Litecoin is a good option to receive and send payments with low fees and fast transaction times. Litecoin does not want to take Bitcoin’s place, but instead, it wants to help it scaling.

Bitcoin developers are now working in the so called lightning network. This technology will allow Bitcoin to scale and process millions of transactions with low fees and almost no delays. Meanwhile, cryptocurrency exchanges and wallets are implementing Segregated Witness. This reduces the size of the transaction, and consequently, reducing fees and transaction times.

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