Cryptocurrencies took another step toward widespread legitimacy as lawmakers in a pair of states, Wyoming and Arizona, put forward proposals to accept digital currency tax payments.
The Arizona proposal would have the state recognize bitcoin as legal tender. Wyoming’s proposal, meanwhile, applies only to sales and use tax but is not limited to a specific cryptocurrency.
“We are looking for alternative currencies to compete with the U.S. dollar,” said Zhou Xiaomeng of American CryptoFed, a group backing the Wyoming proposal.
Many retailers see the Wyoming proposal as a way to add convenience for customers. Wyoming Rep. Ocean Andrew, a sponsor of the amendment, told Politico he wanted to reduce the paperwork burden of sales taxes.
Both proposals face hurdles, with the Arizona bill running a high risk of being deemed unconstitutional because the Constitution restricts the power of states to issue their own money. By explicitly trying to designate cryptocurrency legal tender, the proposal could be in violation.
But despite the outcomes of these proposals, they are both further signs that cryptocurrency could be pushing toward more mainstream acceptance. Last year, Colorado governor Jared Polis made statements saying that he wanted his state to be the first to accept crypto for tax purposes. Both Jackson, Tennessee and Miami-Dade county are also examining similar possibilities.
Get Exposure to Crypto Through Equities
Cryptocurrencies remain a volatile asset, but rather than taking on the assets directly, investors can get exposure to them through equities by utilizing ETFs like the Vaneck Vectors Digital Transformation ETF (DAPP). DAPP has exposure to companies that work on the infrastructure of digital currencies. Crypto is becoming an increasingly mainstream aspect of financial life, and DAPP gives investors exposure to the miners, exchanges, and other firms at the forefront of the digital transformation.
DAPP’s top holdings include companies like Coinbase Global, Block, and Silvergate Capital Corp. The fund has an expense ratio of 0.50.
For more news, information, and strategy, visit the Crypto Channel.