Colorado to become first state to accept cryptocurrency for tax payments
kdvr.com
kdvr.com
Colorado won’t be accepting bitcoin. They will be accepting dollars from a payment processor that accepts bitcoin.
Your tax bill will still be in dollars, and at the end of the day you will be responsible for ensuring that the correct number of dollars ends up in state coffers.
This is the same as saying that Colorado will now be accepting Canadian Dollars and Peruvian Soles because I can use a foreign denominated credit card with their cc processor.
You seem to be trying to make this not a win for cryptocurrency. It is. Sorry.
If the governor is serious about this he will push to remove the tax, as some countries have. It'll be hard to be the center of crypto innovation while taxing transactions.
That said, "you can now use crypto for X" is kind of news. The principle of "can do X with Crypto" may be established, but the practice isn't. Bigger news would be Y% of colorado residents pay tax with crypto.
Seriously though, a state announcement on Facebook reposted in a tabloid style website without any of the pertinent information, like what currencies are being considered, perfectly sums up the problems with information technology. I should be reading www.colorado.gov
As for the crypto, this seems like a nice way for the state to collect and keep tabs on cash flow. So good on them for being smart I guess. Is it actually easier for people? No. But a lot of people did get sucked into this crypto thing, so you move where the money is.
Why do you think this article both misrepresents the situation, omits mentioning federal tax implications of paying in this manner, and is not on a Colorado government site? Cui bono?
The answer is: 'Because this is a submarine article targeted at crypto shills, by crypto shills.'
https://www.google.com/amp/s/www.wsj.com/amp/articles/pay-ta...
Announcement also on Facebook: [0]
[0] https://www.facebook.com/jaredpolis/posts/486922196339837
... "for the payment of state tax and fees." The original article's headline just says "payment" -- but it's not the entire universe of all payments.
Having said that, Colorado's governor is very pro-crypto (and pro-technology in general)...
If the federal government ever allows other forms of payment for taxes, the USD would be able go to zero as easily as any crypto can today.
If the Bitcoin was stolen or used fraudulently aren’t you still required to return it?
If you steal Bitcoin and use it to pay your Colorado state taxes, you remain liable (1) to the government for your theft, and (2) to the person you stole from for "conversion" of their Bitcoin. The first is a criminal issue (government comes after you); the second is a civil one (person comes after you). But Colorado's revenue agency doesn't care; they got paid and they get to keep it.
If you make up a fake credit-card number and use it to pay your Colorado state taxes, then the bank will eventually figure out what happened and reverse the transaction. Then the Colorado Department of Revenue will come after you for unpaid taxes (as well as for other misdeeds you have committed).
Note that Colorado isn't receiving Bitcoin directly, but rather is using a digital-currency payment processor. That company might decide to reverse iffy transactions. The problem is that the company can't reverse the Bitcoin transaction. They might decide, as part of their business model, to absorb the costs of fraudulent/illegal transactions and pass the (negative) savings onto the customer through fees. But they can't reverse Bitcoin transactions, any more than someone can command cash to fly out of the recipient's pocket and back into their own.
Unlike cash, but like any other stolen asset, if you unknowingly receive stolen bitcoin, you could still be legally required to return those bitcoins to the original owner.
> But they can't reverse Bitcoin transactions, any more than someone can command cash to fly out of the recipient's pocket and back into their own.
If "they" is a court, they absolutely can command you to take cash out of your pocket or to reverse a transaction you received.
If someone uses Bitcoin, all they have to do is tell the victim “code is law, try suing them”. The appeal is obvious.
This is really naïve. The cops show up and tell you to return stolen goods all of the time. You either do it or go to jail.
The SAFE Banking act still hasn't passed. As far as I know, the cannabis industry is cash only.
If anyone has any further reading about this, I'm interested.
EDIT: Less wordy, easier to read.
For me (live outside US) this sounds a little strange, are returned payments on tax payments happen so often that a governor has to mention it?
eg if 1% of payments are returned, they need to devote 10% of their operational overhead to it.
Like, in what way does this benefit Colorado or the United States?
“People in the far future will read the history books with great amusement.”
Who knows what’s going to happen in the far future?
Yes the only reason someone can make this comment is because they’re jealous of all the money they missed out on.
By the way, the word you’re looking for is envy, not jealousy smh.
It’s isn’t about making money, it’s a question of what Bitcoin is and how it works.
The original point was for small and ultra low overhead transactions, not as a way to make money. I am not saying the price is hitting 0 in 6 months or even 6 years, but clearly the original goal failed, interest is going away, and no use case has replaced it.
https://www.cbinsights.com/research/report/blockchain-trends...
That shows over 700% growth and your excuse is that everything is going down except for NFTs?
Meanwhile you haven't linked anything to back up your claims.
Clearly that isn’t a refutation.
You keep saying it's going down and you still haven't given any evidence of that or explained why you think that. Saying the same thing over and over more forcefully is not evidence.
What is asserted without evidence can be dismissed without evidence.
Of note, I didn’t refer to the ROI from holding coins which is way down. I suggest it take a second and consider why I didn’t make that argument.
You just keep saying that despite those graphs being up over 700%, somehow this stat you chose and haven't sourced is down.
You haven't explained in any way why you think that but you keep saying it over and over.
Wow, that’s just perfect. Do you mind if I share this thread?
This is your claim with no evidence, no source and no explanation.
This could not possibly be more ridiculous. Any search you do produces an avalanche of links that directly contradict what you are saying.
Your sources of absolutely nothing are not very convincing.
Is this a joke? This is like someone getting soaked in a flash flood while claiming it isn't raining. I've never seen anyone deny reality this hard, even here.
https://www.nytimes.com/2021/12/20/technology/silicon-valley...
https://www.paymentsdive.com/news/blockchain-startups-landed...
https://originstamp.com/blog/top-blockchain-startups-to-watc...
https://www.cnbc.com/2022/02/02/crypto-start-ups-raised-huge...
https://www.institutionalinvestor.com/article/b1w6r1v3pjg15s...
https://bitcoinke.io/2022/02/crypto-startups-in-january-2022...
https://blockworks.co/report-vcs-invested-33b-in-crypto-and-...
https://fortune.com/2021/12/01/investors-fund-crypto-startup...
https://www.bloomberg.com/news/articles/2022-02-01/new-york-...
https://news.crunchbase.com/news/private-crypto-vc-funding-u...
Anyway, this is public so I can always just link to it.
This is what you said. Stop pretending you didn't say this and give some evidence.
The New York Times article alone says:
Investors, too, have flooded in. They have poured more than $28 billion into global crypto and blockchain start-ups this year, four times the total in 2020, according to PitchBook, a firm that tracks private investments. More than $3 billion has gone into NFT companies alone.
More than 28 billion dollars into start ups in one year.
Anyway, this is public so I can always just link to it.
Oh yeah? Twelve comments deep and you're now threatening to maybe actually link some evidence (in the future)?.
How is this not embarrassing to you? Do you try to convince people the sky is red and the earth is flat?
Why do you keep replying without evidence? Because it doesn't exist. If it did, you would have linked it already.
https://www.cbinsights.com/research/report/blockchain-trends...
That’s why I was curious about which data you’re basing the statement on. Was wondering if it was wallets, inflows, etc.
If you’re unclear, coins are supposed to be fungible where NFT’s shouldn’t be.
Rather than expend the resources to develop it themselves, they are giving the crypto community enough space to do the R&D for them. Once the technology evolves to a point that it is both secure and practical, the governments will implement their own digital iterations of their respective currencies.
The trust stuff is actually the least interesting part (though perhaps a prerequisite for it).
The interesting part is the potential for a “universal” api. Instead of having to integrate with every financial institution to support the myriad payment methods out there you can support the crypto currency. That’s a big deal.
It’s not what the crypto libertarians are pitching and I still believe that governmental currency controls will always be a thing but standardizing the actual mechanics of money movement would be huge.
This is true both at the application level and the software standards level. An example of the first would be Uniswap. Any one in the world can access this exchange, both for listing tokens, and for trading them, and it is guaranteed to never shut down, as long as the Ethereum network and blockchain exists. This is absolute universality in terms of APIs.
In terms of software standards, the EVM is already used by multiple blockchains, which makes them all share the same address format out of the box, and compatible with software like MetaMask that has tens of millions of installations. I could send Ethereum tokens to your Polygon (an EVM based chain) address, and you would be able to use your Polygon Chain private key to access them. All that you would be required to do is go to MetaMask and switch your network from Polygon to Ethereum mainnet, and the tokens would be appear in your wallet interface.
>>It’s not what the crypto libertarians are pitching and I still believe that governmental currency controls
Government currency controls cannot be a thing any more. Monetary transactions dependent solely on cryptographic authentication, and published to a completely decentralized and immutable platform, totally unmoors money from the types of bottlenecks that state actors could use to control its flows. To control currency requires controlling the flow of information now, and with the universal adoption of the internet, that is not happening.
A system that is powered by crypto making payments and etc basically free, but with the ability to reverse fraud transactions or similar. They have their own goals/constraints that are different than crypto currencies today. Another comment refers to a universal API; even if the API is JUST for settlement between banks it would probably make things way simpler, cheaper, and more efficient.
edit: typo, added universal api comment agreeing with comments from kasey_junk
Taking myself as an example, of all the actual money I currently own (so, not counting securities and whatnot, just cash and bank account balances), approximately 99.5% of it is currently digital and 0.5% of it is analog. And 100% of that is US dollars. And I'm unusually heavily invested in portraits of Andrew Jackson right now; it's typically more like 99.9% digital.
At present, I'm quite happy with USD for my digital currency needs because it offers me greater convenience and lower transaction fees than the available alternatives. One particularly compelling feature is that it's easily convertible to physical currency (and always at a nice, predictable 1:1 exchange rate), which remains the only game in town when I want to make a truly anonymous transaction. For example, when I give money to a pahnandler, I really don't want there to be any paper trail that the person I'm giving money to can possibly trace back to me.
The actual impact on US currency valuation will be negligible. Even if it weren't, I believe a large portion of Colorado's economy is based on producing export goods, so a weaker USD is theoretically beneficial to at least some segments of the state's economy.
Arguably, the fact that we're sitting here chatting about Colorado on hacker news indicates that the alleged plan has already succeeded, months before the system is scheduled to come online.
I was also not trying to suggest that it's "export focused" - that would imply that that's a dominant factor in the economy, which is not what I intended to say. I chose the word "large", not to imply that it's a majority, but to imply there's enough money tied to it to make it politically interesting to the elected officials who are driving these sorts of decisions. See, for example, how coal played into the 2016 US elections, despite the US economy not being anything close to "coal focused".
It would be nice to find a percentage-based chart which breaks down economic sectors for the state. It exists somewhere, no doubt, but I am unable to find it this morning.
I do agree with your first point: crypto-for-taxes is primarily a headline generating gimmick. One that sells Colorado as a state with tech-savvy leadership.
“In Colorado, we’ve been laying the groundwork to be a center of crypto and blockchain innovation for a number of years. We see it as a critical part of Colorado’s overall innovation ecosystem,” shared Polis.
This is what the US needs to embrace as a whole, otherwise we won't be competitive with the countries that do as the US dollar (petrodollar) loses its primacy on the global stage.