Yes, there's nothing stopping this from happening. A problem is that each address that is to receive the citizens' salary would have to be tied to a specific person. A government can do this, but it would also basically give the government power over this money. And they would have the power to create addresses to receive funds for wars and stuff like that, just like they do with fiat currencies.
Another problem is that this would cause an "inflation tax" on the currency's users. The only people who would want to use the currency would be people who stand to gain more from income than they would lose from inflation. If the income was high enough to provide for the cost of living inflation would have to be very high. In the long run, the currency would become almost or completely worthless as "taxpayers" abandon the currency and inflation takes over.