The Texas Comptroller issued a private letter ruling on June 3, 2025, addressing whether the selling of bitcoin is “either the sale of tangible personal property (TPP) or the sale of a security” for Texas franchise tax purposes. The taxpayer requesting the guidance, a qualified S corporation for federal purposes, acquires bitcoin and resells the bitcoin to its customers in exchange for cash at ATMs. The Comptroller concluded that because bitcoin is a cryptocurrency and digital asset/digital token, bitcoin is intangible property, not tangible personal property.  Because bitcoin is intangible property, the taxpayer cannot use its costs from acquiring the bitcoin in its cost of goods sold deduction when determining its franchise tax liability. The Comptroller also concluded that bitcoin does not qualify under the franchise tax’s definition of “security,” nor is it a “currency” to either the IRS or the Texas Department of Banking.