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The Arizona legislature is considering a project that could change the regulation of digital assets. The deputies propose to exempt transactions with Ethereum from paying capital gains tax at the state level. If the law is passed, Arizona will create a unique financial environment that can completely change the approach to cryptocurrencies.

Currently, most states, including Arizona, follow the instructions of the tax service, which considers cryptocurrencies to be property. This means that any profitable operation requires paying taxes. The new bill aims to break this link at the state level by removing tax barriers to the daily use of ETH.

The adoption of the law may have several consequences. First, Arizona may become attractive for blockchain companies and decentralized finance. A softer tax burden is a serious advantage for attracting startups and investments. Secondly, it may push stores and services in the state to accept Ethereum as payment, as tax uncertainty for users will disappear. This would help introduce cryptocurrency into the real economy.

But the law still has to go through several readings, get approval in committees and be signed by the governor. Critics say that the state budget may not receive enough revenue, and compensation will need to be sought. Besides, no one has abolished federal taxes. Even if the state exempts taxes, Arizonans will still have to declare income from cryptocurrency transactions to the IRS and pay federal taxes. So this is only a partial solution that removes part of the tax burden.