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Why Small States and Cities Are Betting Big on Cryptocurrencies to Drive Local Development

14 April, 2020 Technology

Global-cryptocurrencies

 

Introduction

When the US state of Ohio announced in late 2018, that it is going to be the first state to accept taxes in Bitcoins, it sent a strong signal worldwide. The Governor of Ohio stated that the state will not start accepting 23 different kinds of taxes in Bitcoins. 

The intention was to allow more people to pay taxes in ways, which were convenient for them. This was also done as a means to attract investors and businesses operating in the cryptocurrency ecosystem. The State Treasury Head, Mr. Josh Mandel was proud in proclaiming Ohio to be a state, which is pioneering Blockchain technology. Bitcoin has been very favourable in various countries in recent days. 

Ohio is not the only state that has adopted a favourable response to Bitcoin and other cryptocurrencies. In this article, we will look at how states and cities are using Bitcoin to power growth stories for their population. 

Why Small States and Cities are taking the lead in Cryptocurrency adoption?

Most of the old states in the American Union have been severely affected because of outsourcing. There are towns, cities and states, which have lost factories, mining, heavy manufacturing because they have been outsourced to third world countries. 

The government in these regions are betting big on investors coming to these regions to innovate on Bitcoin and Blockchain technology. States are wooing investors in many ways. Some of them are-

  1. Easy access to land at a convenient spot in the city. 

  2. Cheap electricity for Mining activities and maintaining Data Records of Blockchain

  3. Exempting cryptocurrencies for paying transaction fees.

  4. Easy business licenses to speed up setups and start innovations. 

Tax exemptions on operating cryptocurrency businesses for the first few years. 

Some of the states, which have already removed transaction fees on cryptocurrencies are- Wyoming, Tennessee, Kansas, Texas, New Hampshire, and Illinois. Without a doubt, this number will definitely go up in the future. 

Can these Small States hope to the center for the Next Silicon Valley Revolution?

Most of the states, which have been mentioned above are expecting Bitcoin and cryptocurrencies to be the next Silicon Valley wave. However, its needs to be investigated whether their expectations are correct or not?

Many experts and tech moguls have proclaimed Bitcoin to be the greatest tech invention in the world after the internet. The philosophical and theoretical underpinnings of Bitcoin are strong. It aims to create a world of financial inclusion. The success of the same for over a decade demonstrates that it is not a trend, which is going away anytime soon. 

By being one of the front-runners in the entire Bitcoin ecosystem, states are expecting businesses borne out of Bitcoin to favour them. Yes, Bitcoin or mining itself is not going to generate too many employment opportunities.

It is only associated businesses, that are using Bitcoin or Blockchain technology, which are going to the real drivers of local economies. 

Is Bitcoin a Reliable and Safe Bet for local populations and authorities?

If the recent Coronavirus pandemic and market crashes are any indication, most governments should start exploring an emergency proof currency system. There are many advantages of using cryptocurrencies. It is inflation proof, is not subject to the highs, lows of market crashes, and aims to help the lowest rungs on the financial ladder. 

Financial inclusion can be a reality for almost 2 billion of the world's unbanked population. It is no wonder then that Mark Zuckerberg, the Founder and CEO of Facebook, has jumped on the cryptocurrency bandwagon, with his own ‘Libra'. 

Do you think Bitcoin and Blockchain can guarantee employment opportunities? Let us know in the comments section below.


 


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