Testimony to Subcommittee on NH HB552, To Legalize Bitcoin for Payments of Taxes and Fees
Jeremy Kauffman • Sep 17 2015
(This is prepared testimony on NH bill HB552 to be given Thursday, September 17th, 2015. Thanks to Christopher David of Leonine for setting this up!)
Honorable Representatives of the Committee:
As an expert on these issues and someone would like to bring more technology jobs to this state, I would be remiss if I did not testify on this bill.
First, some background. At 30, in just the last few years, I have built a company that processes tens of millions of dollars in online merchandise and employs nine professionals. With my latest venture, I expect to do better. And I'd like to do better right here in New Hampshire.
Along with most technologists, I am resolutely convinced that the innovations of Bitcoin will play a tremendous impact on the future of the world. However, that innovation also means changing the ways that things are done. Innovation can also upset people who have a vested interest in maintaining the status quo.
Some states, like New York, have reacted to this change with fear. They've created a climate that is actively hostile to electronic currencies. What is the result? An exodus of startups from New York. Those aren't my words by the way -- they're from Fortune magazine.
If you're not a nerd under 35, you might not realize how much press this will get among a crowd of people that are tremendously desirable to this state. The types of people that bring jobs and tax revenue.
This bill is an opportunity. An opportunity for the New Hampshire legislature to broadcast to technology companies around the entire world that this is the place to come and build your business. The fact that this is a place where laws like this are even being considered caught my attention and was part of why I moved here. Please, do not pass up this chance to trumpet your support for innovation and technology.
Additionally, I've answered the 3 questions proposed by Treasurer Ohm.
1) Should the Treasurer accept commodities for payments? (The IRS has classified bitcoin as a commodity)
With no offense to Mr. Ohm, no one is asking for him to accept payment in Hard Red Wheat #3. A better way to ask this question is, "Should the Treasurer accept a method of payment that is desired by the people and their representatives, costs the state a little money and no risk, and has the potential to bring jobs to the state?"
My answer is a resolute yes.
2) If so, what commodities should be accepted? Stocks, bonds, gold bars, bitcoins, etc.?
My answer is inferable from above. The Treasurer should accept any method of payment that is desired by the people and costs the state little money or risk. Jobs are just a bonus.
Also, note that Bitcoin is not like the other items mentioned as it is a payment system.
3) What are the risks in liquidating the commodity?
Bitcoin processors offer an ability to convert to dollars instantly. You can be absolute, 100% guaranteed that you will get the exact dollar amount specified as due by companies backed by hundreds of millions of dollars in venture capital. Bitcoin processors are not dubious operations; they are highly reputable. Practically every major bank in the entire world is pouring millions of dollars into this technology right now.
Additionally, whichever processor lands the New Hampshire government will be a huge coup for the company. The ability to award this contract alone will offer immediate positive effects.