What’s Going on in Cryptocurrency: Latest Developments

by | Mar 13, 2019 | Cryptocurrency

Latest Crypto News

Latest Crypto News: The world of cryptocurrency, though relatively untamed, is evolving as legislators work to create a regulatory environment that can meet the demands of today’s society. If you are involved in cryptocurrency trading, it is important that you stay updated on the seismic shifts in cryptocurrency policy and regulation, especially since the landscape is ever-changing and will likely continue to be in the future. Set forth below is a brief description of some of the latest developments that affect cryptocurrency.

  • The IRS considers the recognition of income from cryptocurrency investments to be a taxable event. Nevertheless, many taxpayers are not reporting cryptocurrency transactions to the IRS. This may not be surprising since the IRS has not yet introduced clear guidelines on how cryptocurrency investment gains should be calculated. The lack of guidance notwithstanding, the IRS increased enforcement efforts with respect to cryptocurrency-related tax evasion in 2018 and is expected to accelerate such efforts in 2019.
  • In 2016, Bitcoin wallet provider Coinbase attempted to stand up to the IRS by filing a lawsuit in the federal district court for the Northern District of California. The lawsuit sought to stop the IRS from accessing identification information for over 14,000 users of the exchange. Coinbase ultimately lost its lawsuit in the 2017, decision that was sharply criticized by proponents of financial privacy. However, the IRS has continued its aggressive stance on cryptocurrency enforcement since Coinbase’s failed lawsuit in 2017.

  • The world is still waiting for a “Silicon Valley” of cryptocurrency to emerge. Presently, some view Switzerland as the most likely candidate to emerge. This is true, in part, because the Swiss government has encouraged progress in the cryptocurrency arena, as evidenced by the fact that many Swiss blockchain firms are growing rapidly. Moreover, the Swiss Blockchain Federation continues to actively foster ties between the Swiss government and Swiss-based blockchain firms.

  • New York’s attitude towards the cryptocurrency market is decidedly more skeptical than Switzerland. New York Attorney General Eric Schneiderman has launched an investigation targeting 13 major bitcoin exchanges, which involved sending detailed questionnaires to such exchanges. Since some exchanges are headquartered abroad, some observers have speculated that these exchanges could simply move their assets out of reach of New York authorities if trouble arises.