In a groundbreaking development for the financial landscape of the United States, Utah is poised to become the first state to allow vendors to receive payments in gold and silver. This innovative move, rooted in a recently passed bill during the 2025 legislative session, marks a significant shift towards integrating precious metals into everyday transactions.
Utah’s Legislative Milestone
The new bill, which has received overwhelming bipartisan support, empowers the Utah treasurer to implement a competitive procurement process for a cutting-edge electronic payment platform backed by precious metals. This initiative enables state vendors to choose payments in physical gold and silver, providing a fresh avenue for financial transactions in uncertain economic times.
- Sponsored by Rep. Ken Ivory
- Carried in the Senate by Sen. Keith Grover
- Passed with strong backing from both the House and Senate
Now, the legislation awaits the governor’s approval, potentially paving the way for Utah to set a precedent as the first state in the nation to embrace transactional gold.
Enhancing Economic Security
The legislation stems from the efforts of the Utah Precious Metals Study Workgroup, which has tasked Utah Treasurer Marlo Oaks with exploring the economic benefits of investing state funds in precious metals. This initiative aims to bolster Utah’s economic security and ensure that the physical assets backing the payment system remain within the state, subject to regular audits.
By allowing vendors to opt for payments in precious metals, Utah is providing its residents with a method to safeguard their purchasing power amidst economic fluctuations.
A Technological Leap Forward
Thanks to technological advancements, the proposed precious metals-backed electronic payment platform could facilitate:
- Fractional gold transactions
- Real-time transactions
- Seamless conversions between dollars and gold
- Secure storage of gold in compliance with stringent safety regulations
Support from Industry Leaders
The legislative initiative has garnered support from influential figures, including former Federal Reserve Vice Chair Randal Quarles and former CFO of Citigroup and American Express, Gary Crittenden. Their endorsement underscores the growing recognition of gold and silver as viable forms of currency.
Historical Context and Future Implications
Historically, gold served as a primary medium of exchange in the United States for over 150 years. However, in 1974, the IRS reclassified gold as a collectible, imposing the highest capital gains tax rates on transactions involving gold and silver. This tax policy has discouraged trading in precious metals, as each transaction is viewed as a taxable event.
The U.S. Constitution, specifically Article 1, Section 10, empowers states to recognize gold and silver as legal tender. Utah became a pioneer in this regard in 2011, and the introduction of a precious metals-backed payment platform further reinforces the argument for treating gold and silver as legitimate forms of currency rather than taxable assets.
In conclusion, Utah’s legislative decision to embrace gold and silver transactions marks a pivotal moment in American finance, potentially influencing other states to follow suit. As the nation witnesses this shift, the future of precious metals in financial transactions appears brighter than ever.
