Colorado will accept crypto for taxes starting this summer

The cryptocurrency regulatory framework in the US might not be well established, but this has not hindered the use and adoption of digital assets. Multiple states are rushing to endorse crypto assets and promote their regions as hubs for cryptocurrency trading.

Colorado has joined the list of states that are endorsing crypto. The governor of Colorado, Jared Polis, is considering accepting cryptocurrencies for taxes in the coming summer season.

Colorado governor endorses crypto

During an interview with CNBC, Polis said that the state planned to accept cryptocurrencies for taxes. However, the governor acknowledged that cryptocurrencies were highly volatile assets. To ensure that the state’s funds are not affected by the volatility, Colorado will immediately convert the crypto into USD.

Colorado will also not hold any cryptocurrency on the state’s balance sheet. During the interview, Polis noted that he does not hold any Bitcoin or any cryptocurrency. He also urged buyers to be aware of the volatility of the crypto market.

Polis also noted that the underlying technology of cryptocurrencies had immense potential. He noted that the concept of cryptocurrencies and their underlying technology was here to stay, as it would lower the transaction costs and boost efficiency. The benefits of the crypto sector would lure more investors into the space.

Battle for crypto dominance  

At least 20 states in the US are considered crypto-friendly. These states have crypto or blockchain specific bills that are being discussed to make them attractive to blockchain firms. Some of these states include Texas, Colorado, Wyoming and Florida.

According to Polis, the growing competition among states to endorse crypto could spark action from the federal government to come in, regulate the sector and create a more favourable ecosystem.

Polis also dismissed that Colorado would create its own state token such as the one created by Miami. According to Polis, having a private cryptocurrency for the state was contrary to what the entire crypto sector was about, breaking free from government control. However, he floated the idea that blockchain technology could be adopted for various government functions such as local elections.