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Ohio has made some major technological advances in the last two months. In November, state treasurer Josh Mandel announced that Ohio would become the first US state to allow businesses to pay taxes with Bitcoin. Soon after, at least seven technology funds in Ohio pledged to invest $ 100 million in startup blockchain.
"Blockchain is an important tool for companies in all sectors: in recent years, the growth of blockchain jobs is increasing, with nearly 2,000 new jobs in the United States, compared to less than 500 in this period of the year. 39, last year "said Craig McGregor, co-founder and CEO of DSTOQ.
Starting from August 2018, the Glassdoor database hosted 1,775 blockchain job openings, with an increase of 300% compared to last year. However, from the Glassdoor list of the top 15 US subway states for Blockchain openings, only one is in the Midwest.
"All the startups I've talked to in these areas are not in the Midwest of the United States – they're in Silicon Valley, sometimes in New York and more often in Basel, Switzerland, where laws are much more favorable in cryptocurrency." said Avivah Litan, vice president and distinguished analyst at Gartner Research. "The Midwest is not known as an outbreak for [Blockchain] innovation, but perhaps it will become so. "
SEE: Research: current status and forecasts for the future of the blockchain in the company (Tech Pro Research)
"It is clear that Ohio is becoming one of the states that most accept emerging technology," said McGregor. "I believe this decision is an opportunity for Ohio to" plant a flag "in the adoption of Bitcoin, and it is hoped that it will add momentum to the growing adoption of all cryptocurrencies."
The adoption of Bitcoin puts Ohio on the emerging technology map, and it could also be advantageous to attract talent across the Midwest.
The benefits
Just the bat, allowing companies to pay in cryptocurrency, increases the "cool" factor of Ohio, according to Litan. "They are trying to get that fantastic technological factor in Ohio, so they can attract startups and technology innovations, which allows them to attract blockchain-based startups," he added.
The addition of Bitcoin as a form of payment is also extremely convenient and useful for the corporate consumer. "One of the obvious advantages to paying taxes with Bitcoin is obviously a lower cost." BitPay, the third-party processor of Bitcoin tax payments, pays a commission of 1%, which is less than half of what Ohio tax payers face when they use a credit card (2.5%), "McGregor said." It is also much easier for companies to pay their taxes online because the nature of encryption is that these transactions can be completed through the Ohio Crypto website from any device across the world."
Also, as with any blockchain transaction, "payments will be fully traceable, which will provide greater transparency to the user," added Frank Wagner, co-founder and CEO of INVAO.
Risky business?
Some people may consider Ohio's movement to Bitcoin to be risky, as the cryptography market has plummeted in the last year. "Many may have the impression that, due to recent market volatility, encryption payments are risky for tax payers in Ohio," said McGregor. "However, the state itself does not hold the Bitcoin, instead they exploit the blockchain technology that converts the encrypted payment into USD, and then deposits it into a state account."
Bitpay is also considering the current state of the market. "To protect against market volatility, the payment processor (BitPay) will set the exchange rate for a 15-minute time window for each transaction," Wagner said. "Once a corporate tax payer initiates payment on the website, BitPay assumes the risk of any fluctuations in the market during the assigned time window, in order to protect investors from any sudden drops in price".
The main risk for Ohio lies precisely in the public interest, said Litan. But even so, this is not necessarily as much a risk to Ohio as it is for the Bitpay company. "I do not think they run any risk this way in Ohio, they're really turning into Bitpay," said Litan. "Bitpay's risk is that people will no longer be interested in Bitcoin payments."
Like other Midwest states, they can attract blockchain technology talent
Ohio's blockchain and bitcoin initiatives demonstrate that there is potential to make the state a blockchain-centered industrial center, Wagner said. "Technology professionals are no longer limited to this kind of high-growth jobs in Silicon Valley, unprecedented access to high-growth jobs," he added. "This in turn will create more jobs and contribute to the economy as a whole".
The growth of blockchain businesses in the state could also prevent technological talents from leaving the area for the coasts. "I am sure that in the Midwest there are very qualified people who would like to stay there because of their family and the cost of living, so this is a step towards promoting an innovative community in Ohio and other surrounding states, if surrounding states take the same policy, "said Litan.
All that the states of the Midwest can do at this point is to follow the leader. "I think [other states] He should do exactly what Ohio did: accept state payments in cryptocurrency, "said Litan." They can also open centers of excellence, such as giving tax breaks to innovation and start-ups, and create a favorable business environment through lower taxes and various financial incentives. "
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Image: iStockphoto / NicoElNino
