Cryptocurrency tax in America – What a Confusing Devil
In a recent news item published by the Technology Review, the magazine discussed the confusing and elusive policy the Internal Revenue Service (IRS) has towards Bitcoin and the fraternity of cryptocurrencies at large.
So far, the IRS has not been specific as how it intends to tax cryptocurrencies, which can prove nerve wrecking to anyone who used to sit on hundreds of thousands of cryptocurrencies, and now just has a few thousands leisurely tucked away.
The problem stems from the basic misconception that if you had failed to pay tax on your old riches, before their out-of-the-blue change in value, you are liable for the same amount of tax today. Of course, this is a debateable point and one that would better never see the light of day. Nevertheless, a lack of clarity gives honest men the willies.
Meanwhile, cryptocurrencies have gone mainstream with the help of something known as Initial Coin Offering (ICO). Mainstream as this trend could be, it is still very unlikely to take root in certain part of the world. On the question of taxation, there are two possible ways to handle the present-day crisis:
- The IRS will impose a minimum flat rate, allowing people to pay a lump sum that is adjusted for the current value of the cryptocurrencies;
- The IRS will want to impose taxes that are as hefty as the value of acquisition of the cryptocurrencies, i.e. charge them for the value that was available at the moment of acquisition;
Cryptocurrencies Taxation – Blockchain Bonanza
The plain fact is that cryptocurrencies are not so popular in certain parts of the world, including China. Conversely, the technology that makes them hum is quite popular and there are no two ways about this. ICOs may have died in principle, but they are just as strongly present. China, for instance, is regulating the market and effectively uprooting any practices that involve unregulated money assets.
China has however created a multitude of infrastructures that are dedicated to advancing blockchain as such. The People’s Bank of China (PBOC) has been openly talking about launching an official digital and sovereign FIAT currency. This is quite nifty and handy in the books of the country. Even though opposed to cryptocurrencies, China is making ever more palpable steps towards ensuring that it will be the new market leader. The country is seeking to establish its dominance in the region and make sure that the future belongs solely to it.
How to Get a Foothold in China’s Growing Blockchain Market
One way to get access to China’s white whales is to tap into Digitly.asia. The platform is a local PR company that utilises the best PR practices to make it possible for investors to garner a clearer insight into the privy market of blockchain.
Digitly.asia may also facilitate Initial Coin Offerings (ICO) by spreading the word and attracting Chinese investors onboard. It is quite possible to optimize content strategy with Digitly.asia. The company has been quite prepared to localize content strategy and promote it all across the region.
Creating tailor-made solutions, Digitly can tap into the funds that are available and help connect investors with entrepreneurs and start-ups.
The future of taxation around the world
China may be taken as a good example. It is overregulating the market, but it is also ensuring that no foul play is afoot. On top of that, the country is toying with the idea of issuing its own FIAT currency that will be regulated and therefore the first legitimate online sovereign currency. If this comes to pass, China will go ahead of the rest of the world and circumnavigate international pressure from the dollar. With the latest trade war already afoot, it is understandable why China wants to extricate itself from any dependence on the US dollar.
The country will most likely succeed in creating sustainable financial patterns that it would be able to export its models overseas and begin rivalling the established economic and financial order. It is an understandable commitment and one that will drastically change how we do business around the world. While the IRS is squabbling how to tax cryptocurrencies, which may soon disappear, China is deciding the future of all money.