Top 10 Worst US States for Crypto Users

Not everywhere in the world is pro-crypto, and understanding which are the top 10 worst US states for crypto users to avoid unnecessary losses. The US crypto economy is as diverse as the nation itself. For these reasons, you should take the time to research and learn the places that you may want to avoid if you seek a peaceful crypto existence. Here are the top 10 worst US states for crypto users in no particular order.

1. Hawaii

Hawaii may be a tropical paradise, but it’s no vacation for crypto firms. The Pacific Island famously made it difficult for blockchain firms to operate after passing funding legislation in 2016 that was impossible to meet. The legislation required all crypto platforms to carry an equivalent amount of cash to back every Hawaii resident’s purchase.

This requirement meant that Hawaii residents never gained access to massive crypto platforms and exchanges. Thankfully, the Commissioner of Financial Institutions at the Hawaii Department of Commerce and Consumer Affairs, Iris Ikeda, has made some efforts to open the nation up to the future.

Iris Ikeda – Improving Hawaii’s Crypto Stance – Top 10 Worst US States for Crypto Users

2. New York

The Empire State makes the list as one of the worst states to live in for crypto users for a couple of reasons. For one, the state has established a strict licensing regime for all blockchain platforms. The requirement to get a BitLicense can be an arduous and expensive task that has limited the hosting of NY-based exchanges to only a select few.

New York has a reputation for going after projects they feel violate regulations and many tokens are not available in the state as a result of these actions. Notably, New York has a population of 19 million people but a far lower rate of crypto-friendly businesses compared to other major global economic hubs.

3. Massachusetts

Massachusetts makes the list due to a combination of high electricity costs and a strong political wing that opposes cryptocurrency in its current state. Also, the state has some of the highest electricity costs in the US, making it a horrible place to mine for crypto. Additionally, it also makes Massachusetts very conservative-minded in terms of the sustainability of projects.

These concerns have led lawmakers such as Senator Edward J. Markey and Elizabeth Warren to rally against digital assets. These anti-crypto voices have put forth legislation and have begun to organize bankers and other similarly-minded groups toward their cause. When you look at the other options for crypto users, it’s best to go where you are wanted versus where the lawmakers are working against your interests.

4. California

Yes, the ‘Sunshine State’ has epic beaches and lovely nightlife, but it is not great for crypto users for some key reasons. For one, California taxes crypto purchases the same as regular fiat transactions. This decision is rare as the majority of states don’t tax these actions at all.

California may be home to a variety of massive crypto projects, but the state’s high cost of living makes it expensive for those seeking to live off of crypto earnings. Notably, of all the states listed, California could change its legislation and become a comfy home for crypto users in the future.

5. Oregon

Oregon is another state that makes the list due to a very loud anti-crypto politician. Senator Jeff Merkley (D-Ore.) has made crypto electricity consumption a major rallying point of his campaign. He has already put forth numerous requests to examine the effects of blockchain networks on air, climate, and the environment.

6. West Virginia

West Virginia has had the strongest reactions to the cryptocurrency movement. The rural state has had multiple instances where bills were introduced that would make crypto usage more difficult for the average user. These bills range from qualifying and taxing crypto as money, all the way to banning it in its entirety.

7. Maine

Maine makes the list due to its high cost of living and electricity. Miners may find it difficult to set up shop in this state as it will cost nearly double some of the other options available. Maine has some of the highest electricity costs in the country, and there isn’t easy access to renewables or tax breaks for miners.

Additionally, in February, Maine’s legislators introduced a proposal that, if passed, would exclude Bitcoin and other cryptos from being considered money. Also, it would lay the groundwork for the state to issue CBDCs (Central Bank Digital Currencies). These centralized bank-issued blockchains lack the freedom and privacy of not government-sponsored networks.

Top 10 Worst US States for Crypto Users

8. Connecticut

Connecticut is another Northeastern state that has high electricity and taxes. The cost of living in Connecticut is above much of the other states in the country. Notably, the state doesn’t tax crypto trades or usage, which makes this state rank slightly above others on this list.

Interestingly, Connecticut passed legislation that requires all crypto platforms to be licensed and have a surety bond to back up their actions. These restrictions have led to Connecticut residents being banned from buying crypto on major exchanges in the past.

9. Rhode Island

Rhode Island is one of only a few states that require crypto businesses to get a currency transmission license. The state law requires all businesses that operate in the crypto sector to get a custodial license if they will handle your digital assets. Specifically, the licensure provides the business with the ability to “maintain control of virtual currencies or transactions in virtual currencies‘.

Additionally, the state has historically high electricity and taxes. These factors mean that Rhode Island residents and blockchain business owners pay more to do the same things people in other states can accomplish for less.

10. Vermont

Vermont is on the list due to its lack of support structure. The state has high electricity alongside its northeastern neighbors. Additionally, Vermont has barely any in-person ways to access cryptocurrencies. For example, the state is registered as having under five crypto ATMs at the moment.

The Top 10 Worst States for Crypto Traders – Stay Ahead

Now that you understand the top 10 worst states for crypto traders, you’re better equipped to lay out a long-term strategy that meets your needs. Depending on whether you’re a miner, trader, or daily user, there are plenty of reasons to avoid paying more due to the state you call home. Check out some of the top 10 pro-crypto states.