More States Likely to Embrace Blockchain Technology, Cryptocurrency

This week, Ohio became the first U.S. state to accept bitcoin for tax payments from businesses. Eventually, the payment form will be open to individual filers as well. Could more states follow suit in embracing the cryptocurrency as a legitimate form of currency?

Associate professor Lee McKnight in the School of Information Studies at Syracuse University teaches blockchain management. He says Ohio’s move to accept bitcoin is well timed, but says the cryptocurrency tax portal is really more for bragging rights.

McKnight says:

“Ohio’s move to accept bitcoin for tax payments is well-timed. If Ohio started one week earlier, the state would have already lost 20 percent, as cryptocurrency prices plummeted.

“For businesses which have been holding cryptocurrency assets for the past year, taking the 80 percent loss in value from market peak December 2017 – and deducting from their Ohio state business taxes to the extent permitted by law – may also make sense. As a fraction of total state tax receipts however, it is likely to be a low number of businesses that choose to make payments this way. So, Ohio’s supposed cryptocurrency tax portal is really just a sideshow for publicity and bragging rights.

“The real innovation and real market opportunities for application of blockchain technology are found mainly in non-transparent corners of businesses and governments worldwide. Following Ohio into explicitly backing use of cryptocurrencies is not the right way to think of blockchain adoption and innovation for economic growth for states. Especially since many European and Asian nations, and Canada, are well ahead of the United States, generally speaking.

“Undoubtedly, more U.S states and the federal government will work on catching up.”

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