While many people buy and exchange cryptocurrency, not everyone considers how deeply the practice is regulated within their own states. While some states are somewhat hostile towards crypto exchange and use, others offer legal protections and even the option to pay taxes using Bitcoin. If you live in one of the below states, then you live in one of the friendliest states for digital currency.
- Kansas. Kansas doesn't recognize digital currency as subject to its state's Money Transmitter Act, and does not regulate its purchase or sale – though it does require third-party digital currency exchanges to secure a license to transmit money.
- Montana. Not only does Montana not require a money transmitter license or regulate the sale, purchase, or exchange of cryptocurrency, it actively encourages and supports virtual currency mining within its state.
- New Hampshire. A bill was recently proposed by New Hampshire lawmakers that would allow cryptocurrency to be an accepted payment for state fees and taxes. If passed, cryptocurrency business and individual tax payments could be legal in New Hampshire by 2020.
- Ohio. Ohio is unique in that it was the very first state to permit businesses to pay their taxes using Bitcoin. While individual payers do not yet have this opportunity, lawmakers are anticipating rolling out a cryptocurrency tax payment option for all in the near future.
- Tennessee. Tennessee recently adopted a bill that gives smart contracts and blockchain data legal recognition, and protects enforcement of said contracts.
- Texas. Texas does not require a money transmitter license for the purchase, sale, or exchange of cryptocurrency, since it does not consider Bitcoin or any altcoin to fall under the category of government-issued currency.
While these states don't currently regulate cryptocurrency purchase and sale, political will and public sentiment could shift over time. However, it stands to reason that the crypto-friendliest states will attract crypto-friendly businesses in the long term.
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*This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal, accounting, or investment advice.