Vicco, Kentucky, a town of 300 about 120 miles east of Lexington, has agreed to their police chief's request to be paid in Bitcoin. Vicco is likely the first city in the country to offer a government employee the option of payment with a virtual currency. 

zcopley / Foterzcopley / FoterAccording to the Hazard Herald, Police Chief Tony Vaughn appeared before the city commission last month to request that he receive his salary in Bitcoins rather than dollars. The commission opted to hold off on granting Vaughn's request in order to research the logistics and legalities of such a move. On Monday, the commission ruled that it would not be a problem and approved a city measure that would allow the transactions.

"We [sic] done a checkup on it, and that's the way he wants paid [sic], and that's the way the city is going to pay him," Commissioner Claude Branson told the Hazard Herald

Vaughn will still pay state and federal taxes, Mayor Johnny Cummings explained. The city will remove the applicable taxes prior to depositing his pay in an online account for the city, where it will then be transferred to Vaugh's Bitcoin account. 

Mayor Cummings said that the city account has been set up and Vaughn will likely receive his first Bitcoin payment by the next paycheck cycle. 

Vaughn told reports he was "excited" about the commision's decision. In an interview with Business Insider, Vaughn said he learned about bitcoin three months ago through his son, when he became convinced virtual currencies are the future. "I pretty much think it will eventually take over," he said, "or I hope it does."

Vaughn also said, "We're a small town, so we're trying to take every progressive move we can make. So it's just an interesting experiment."

The news comes on the coattails of several Bitcoin breakthroughs, including the currency's surge past a $1,000 value in late November and somewhat supportive remarks from Fed Chairman Ben Bernanke. 

However, Tech Dirt's Mike Masnick thinks the whole thing could be little more than a publicity stunt

Vicco got a lot of attention a few months back when it was featured on the Colbert Report for having a gay mayor and passing a "fairness ordinance" against discrimination.

Police Chief Vaughn is among those featured in the video, talking about how Mayor Cummings is his best friend. After that show, the town discovered that a bunch of folks wanted to donate money to the town.

Both Cummings and Vaughn have talked about "capitalizing" on the attention, including appearing on a reality TV show. A reality TV show where they show off how "unusual" they are? Suddenly the idea of a wacky police chief who gets his salary paid in Bitcoin seems like yet another "hook".

Perhaps supporting Masnick's cynical interpretation, the city plans to set up a Bitcoin account where visitors are encouraged to donate to help pay for local infrastructure improvement projects.