Officials in a small Appalachian town that has seen its coal industry dry up over the past two years are hopeful that Bitcoins, the Internet currency, can play a driving force for jobs.
Both the mayor and police chief from Vicco, Ky., a town of about 330 residents located about 130 miles southeast of Lexington, said they will donate their entire paycheck to a Bitcoin account formed in the town’s name.
"If we're willing to take a chance to put ourselves out there, some company should take a chance on us," Tony Vaughn, the police chief, said. "At this point, we'll try anything."
Vaughn said he was approved by the city commission to have his entire take-home pay exchanged from the U.S. dollar to Bitcoins. His salary is believed to be the first instance of a government worker being paid in the Internet currency.
"If we're willing to take a chance to put ourselves out there, some company should take a chance on us"
- Tony Vaughn, the police chief
He made the request at a meeting held last month. Claude Branson, a city commissioner, said the board researched Bitcoins and "if that’s the way he wants to be paid and that’s the way the city is going to pay him," the Hazard-Herald reported.
To be clear, Vaughn will be taxed in U.S. dollars before his paycheck is converted to Bitcoins and transferred to the city’s account. The first transaction will likely be executed by the end of the week.
Bitcoins are created, distributed and authenticated independently of any bank or government.
Their relative anonymity holds out the promise of being able to spend money across the Internet without scrutiny. Despite wild swings in value, the virtual currency has been moving toward broader acceptance. A growing number of companies accept Bitcoins, which can be converted into cash. At the end of November, Bitcoins were valued at $1,000 per coin.
Mayor Johnny Cummings said his salary will continue to be paid in U.S. dollars, but he will convert the money and donate it to the town's account. He said he had to recently cut employees' hours at his office in order to prevent layoffs.
"My job is to protect the people here," he said.
Vicco made national headlines when commissioners voted in January to pass an ordinance prohibiting discrimination based on sexual orientation or gender identity in employment, housing and public accommodations.
Vaughn, who owns real estate and does not need to work, said he was called to law enforcement because of his desire to give back. He said he’s seen firsthand, how mine closures affect an entire community.
"Suddenly tire companies aren't selling tires for trucks, gas stations are hurting, smaller businesses," he said. "It's a definite trickle-down problem. They're just not getting the permits they need."
The Associated Press contributed to this report