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Companies and government agencies are doing great efforts to increase the adoption of cryptocurrencies. Recently, a bill was introduced in the New York State Assembly on January 26, 2023, that would allow state agencies to accept crypto as a form of payment for civil penalties, taxes, fines, and any other payment charged by the state.
Bill A523
A crypto-friendly politician and a Democratic Assembly Member, Clyde Vanel, introduced bill A523 at the New York State Assembly. The bill lets state agencies enter into “agreements with persons to provide the acceptance, by offices of the state of cryptocurrency as a means of payment.” These would include various fees like “fines, civil penalties, rent, rates, taxes, fees, charges, revenue, financial obligations or other amounts, including penalties, special assessments, and interest, owed to state agencies.”
Although the bill does not compel the state agencies to accept crypto payments, it clarifies that they can now legally agree to accept such payments, and the respective courts should enforce these agreements.
Bill’s definition of Cryptocurrency
The bill defines cryptocurrency as any digital currency using encryption techniques to generate and regulate currency units. This definition does not limit itself to BTC, ETH, LTC, and bitcoin cash.
Now according to how the state understands the definition, stablecoins may or may not be part of the play. For instance, the supply of a stablecoin is regulated by its issuer and not by cryptography; also, the bill does understand that some cryptocurrencies have an issuer. Thus, the agencies can charge an extra fee from the payer if the cryptocurrency issuer charges it.
How will the Bill be implemented?
The bill now needs to be passed by the New York Assembly and Senate and also has to be signed by the state’s Governor, Kathy Hochul, to be the law.
Although it may not be easy, the state does not have a good image with crypto. In November 2022, NY banned all cryptocurrency mining, becoming the first state to do so. The state also came up with BitLicense, requiring all crypto exchanges operating in the state to have it. However, the NY mayor debated repealing BitLicense in April 2022.
Other States with Similar Laws
California
State Senator Sydney Kamlager of California introduced SB 1275 on February 19, 2022. This would allow the residents of the Golden State to pay for government services using cryptocurrencies. At the same time, political advisors were seen pushing for a proposal allowing Bitcoin to be accepted as legal tender in the state.
Arizona
Republican State Senator, Wendy Rogers, presented bill 1341, asking for Bitcoin to be accepted as a legal tender in the Grand Canyon State.
Colorado
It became the first state to accept crypto for tax payments, with plans to expand it to driver’s license fees, hunting license fees, and so on. State Governor, Jared Polis, signed the Digital Token Act in September 2022, allowing citizens to pay taxes in cryptocurrencies.
Andrew is a blockchain developer who developed his interest in cryptocurrencies while pursuing his post-graduation major in blockchain development. He is a keen observer of details and shares his passion for writing, along with coding. His backend knowledge about blockchain helps him give a unique perspective to his writing skills, and a reliable craft at explaining the concepts such as blockchain programming, languages and token minting. He also frequently shares technical details and performance indicators of ICOs and IDOs.
