The digital currency Bitcoin has, for the first time, had a band removed for use in California.

Previously there was a ban on using currencies other than the US dollar. The new bill, introduced by assembly member Roger Dickinson, repeals Section 107 of California's Corporations Code.

Digital currency has been in use for some time which was, technically, not allowed. Dickinson said earlier in the month "it is impractical to ignore the growing use of cash alternatives". There are other digital currencies in use including Amazon Coin and Starbucks Stars.

The US Internal Revenue Service said, in March, that it will treat Bitcoin as a form of property for tax purposes, meaning it will follow rules similar to stocks.

In the UK HM Revenue & Custom said exchanging Bitcoins is exempt from VAT, but accepting the currency is subject to it.

READ: Bitcoin Foundation vice-president arrested for money laundering