Ohio Bitcoin Tax Payment Program Suspended

It has been less than a year and Ohio has suspended its online portal that allows businesses to pay their taxes using Bitcoin. There is no clarity on when it’s coming back. The state panel that oversees the state’s banking and financial methods, voted Wednesday to suspend the OhioCrypto website while Attorney General Dave Yost researched the legalities and security of how it was set up. The website has been replaced with a page redirecting users back to the Treasurer’s Office’s main site.

State Treasurer Robert Sprague has asked for the review after questions were raised about how it was set up by his predecessor, Josh Mandel. He said he and his staff reviewed the program as part of its routine diligence after he took office in January. He told reporters that Mandel’s office never put the program through the state’s administrative rule-making process that formally lays out how programs are implemented. Sprague has been noncommittal about whether he would re-launch OhioCrypto.com once Yost’s review is complete. The state has accepted fewer than 10 tax payments since the program went live.

Sprague said the lack of use by taxpayers can be part of the debate over whether the program should continue. He said that part of Yost’s review will determine whether the treasurer’s office can re-launch the program unilaterally, or whether approval will be needed from other members of the Board of Deposit. During and after Wednesday’s meeting, Yost, whose vote may be needed to restore OhioCrypto.com, raised concerns about the program’s merits. He was worried about the use of Bitcoin by individuals involved in organized crime, and people in various black markets who don’t want to have traceable bank records.

Faber said that once they have a legal opinion that allows us to have a path forward, we can discuss how to best implement blockchain and cryptocurrency in our payment options. OhioCrypto.com worked by charging users a 1% commission, compared to the 2.5% fee the state treasurer’s office charges for credit card payments. The site’s vendor, Bitpay, pocketed the commission to cover its costs and assumed the risks of any currency risk in bitcoin, the value of which can fluctuate rapidly. It is a matter of speculation whether the program will comeback or not.

What are your thoughts? Do you believe they should maintain the Bitcoin tax payment program in Ohio?