Since Colorado began accepting cryptocurrency for tax payments in September 2022, the amount paid via crypto has been minimal. Out of the$11 billion in income tax collected since 2022, just 0.0005%, or roughly$57,000, has been paid using digital assets.

The state initially saw eight crypto payments totalling$16,426 in 2022, which rose to 22 payments amounting to$23,241 in 2023. However, the number declined again in 2024 to$17,544 across 48 payments.

Governor Jared Polis' initiative allows taxpayers to use PayPal's Crypto Hub, converting their crypto into US dollars. It means Colorado doesn't directly receive crypto, undermining the notion that digital assets are widely used for tax payments.

Bitcoin, primarily a store of value, doesn't lend itself to transactions like these, according to experts.

Although Colorado leads in this innovation, Utah is the only other state accepting cryptocurrency for taxes. Looking ahead, commentators suggest that stablecoins, rather than Bitcoin, will become the primary method for crypto-based transactions.

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