US States Shelve Plans To Accept Bitcoin Tax Payments Amid Crypto Crash

ndtv.com:

Bitcoin alone has plummeted more than 70% since November 9.

Two US states are steaming ahead with programs that will permit taxes to be paid in cryptocurrency, but the idea has been shelved almost everywhere else in the wake of the crash that has erased hundreds of billions of dollars worth of digital assets.

Revenue departments in Colorado and Utah are implementing programs to enable businesses and individuals to pay their tax bills with virtual currencies such as Bitcoin, Ethereum, and Dogecoin, targeting implementation within a few months. The two Western states look to be outliers, however, and still face some logistical hurdles before their programs launch.

The sector's selloff has taken the value of the global cryptocurrency market below $1 trillion from a $3 trillion peak last November. Bitcoin alone has plummeted more than 70% since Nov. 9.

While a half-dozen states have considered following the lead of Colorado and Utah, a chorus of fiscal watchdogs, academics and crypto skeptics is now warning lawmakers against initiatives that might put state treasuries and taxpayers at risk.

“Anything involving crypto is less appealing in the wake of the massive volatility we've seen over the last month, and frankly the last six months,” said Lee Reiners, executive director of Duke University's Global Financial Markets Center. “I don't know if that slows momentum at the state level for payment of taxes, but it doesn't help. And there is no financial benefit to the states to permit it.”

Betty Yee, California's state controller, called a crypto-payment bill (S.B. 1275) currently before the California Legislature “fiscally irresponsible,” pointing to price volatility for cryptocurrencies and lack of a robust federal regulatory