Overstock to Pay a 'Portion' of Its Taxes Using Bitcoin in Ohio

Cryptocurrency-friendly online retailer Overstock, which has been accepting bitcoin payments since 2014, has recently revealed through an announcement on its investor portal that it will pay ‘a portion’ of its taxes using cryptocurrency in Ohio.

According to the announcement, the retail giant is using Ohio’s recently-launched OhioCrypto.com, a portal that allows taxpayers to pay taxes using the flagship cryptocurrency, to pay its commercial activity taxes (CAT) in Ohio.

Ohio’s initiative was announced back in November, when state Treasurer Josh Mandel, who has been in the office since 2011, revealed he sees bitcoin as a “legitimate form of currency,” and that the program will help Ohio stand out in cryptocurrency adoption.

The move will make Overstock the first business to pay its taxes in bitcoin. Commenting on it Patrick Byrne, the company’s founder and CEO, revealed Overstock was “proud to partner” with the state’s government and officials to “help usher in an era of trust through technology for our nation’s essential financial systems.”

We have long thought that thoughtful governmental adoption of emerging technologies such as cryptocurrencies (when accompanied by non-restrictive legislation over these technologies) is the best way to ensure the U.S. does not lose our place at the forefront of the ever-advancing global economy.

Ohio’s crypto initiative lets businesses and taxpayers pay in bitcoin b signing up on its OhioCrypto.com website, entering tax details, and sending over the payments using BTC. Before the Ohio Treasurer gets the funds, they go through BitPay, which converts them to USD.

In Overstock’s announcement, Mandel noted the state applauds the company’s move for “becoming the first national brand in America to register to pay taxes via cryptocurrency. Their embrace of blockchain technology was ahead of its time and we’re proud to have them join OhioCrypto.com.”

The online retailer has been heavily involved in the crypto space since 2014. It has launched a subsidiary, Medici Ventures, which sees it invest in blockchain companies, and it’s also developing a security token trading platform, tZERO.

Last year, the company revealed it’s planning on selling its decades-old retail business so it can go “all-in” on cryptocurrencies and blockchain technology. This would leave it with its Medici Ventures subsidiary and some funds, and at the time the announcement saw the prices of stock plummet.

Israel Bitcoin Association Petitions Banks to Reveal Crypto Policy

Neil Dennis

A number of Israel's bitcoin traders have already filed lawsuits against the country's banks and on Monday traders lodged a formal petition demanding that the financial industry explains its cryptoasset policy.

Israel's banks have barred the country's crypto investors from depositing the returns on their bitcoin and other digital currency investments due to the nation's strict laws on money laundering and the financing of terrorism.

In recent months banks have even blocked investors who are known to trade cryptoassets from opening accounts, according to a report by Israeli business journal Globes.

Central Bank Warning

Israel has seen strong growth in digital currency investment in recent years and in 2014 the Bank of Israel, the nation's central bank, issued a warning - in co-operation with the Tax Authority and several regulatory agencies - about the dangers associated with the use of virtual currency, including fraud and money laundering.

Taking aim directly at financial services providers, the statement said:

As the use of virtual currencies enables their anonymous transfer, in many cases evading the need to use financial institutions that are subject  to an anti-money laundering and terror financing prohibition regime, this is an activity with a high risk co-efficient in terms of money laundering and terror financing. Therefore, financial institutions must take this into account within the framework of their risk management policy.

Injunction

Israel's top legal authority is well aware a problem exists. In February 2018, the Supreme Court issued a temporary injunction prohibiting a bank from blocking activities in an account held by a company that engaged in bitcoin trading.

The bank, however, countered the Supreme Court's injunction, citing the 2014 Bank of Israel warning regarding the risks of bitcoin trade. The bank alleged that activities exposing the bank to such unlawful acts might "harm its reputation and public trust in the bank".

While the injunction stood, it did not affect the bank's right to examine individual activities in the account, nor did it affect the bank's ability to take steps to minimize risks associated with the business activities of the company.

Freedom of Information

The freedom of information petition filed in the Jerusalem District Court on Monday by the Israel Bitcoin Association demands that commercial banks make public their policies on cryptoassets.

Jonathan Klinger, legal adviser to the Bitcoin Association, told Globes:

Under the Banking (Licensing) Law, it is the duty of a bank to state to the Bank of Israel the policy under which it refuses to conduct transactions. We therefore contacted the Bank of Israel and asked for this information, but the Bank of Israel did not agree to disclose this policy to us. We therefore decided to petition the court to force the Bank of Israel to provide us with a copy of the policy submitted to it by the banks.

Lawsuits

Last week the Tel Aviv District Court received a petition for approval of a 75 million shekel ($21.3 million) class action suit against Bank Hapoalim that alleges the bank refused a customer seeking to deposit money from the sale of digital currencies.