Cryptocurrency Leaps a Step Closer to Mainstream Adoption as Leading Cryptocurrency Platform Reached Consensus with US tax Authority
Mar 23, 2018 Posted / 1500 Views
Claims of evading taxes has for a long time been a major standpoint of government officials on abolishing cryptocurrencies. With the capabilities associated with transaction anonymity of cryptocurrencies, transaction can remained uncensored because the identity of the person who just carried out the transaction will remain concealed.
However this is changing as well established cryptocurrency exchange ls are finding it more and more difficult not to cooperate with governments. In many countries a lot of cryptocurrencies platforms have been shut down because of the same reason. Coinbase, a leading cryptocurrency exchange in the United States has taken steps that will change the entire industry and push cryptos to the next level.
Although many enthusiast believe that anonymity is among the principle features of cryptocurrency, for cryptocurrency to find its way anywhere near becoming mainstream, anonymity is one of the features which will be compromised. The authority are very concerned about taxes and money laundering, an accusation which is well associated with Cryptocurrency too.
According to coinbase, an automatic tax calculator based on returns is incorporated into the coinbase wallet, this is meant to allow users to calculate the amount of taxes they are supposed to pay from every cryptocurrency transaction. The tax calculator was designed following the United States tax laws.
In a recent blog, coinbase stresses that it does not give tax advice to users but highlighted the recommended steps users should follow to comply with the tax policies. It is worth noting that the tax policies are only going to affect the US customers meanwhile coinbase has not specifically given any further information about the fate of the customers outside of the United States.
Its reported that coinbase was following a court order requiring the exchange to share personal data of every user who has already complete transactions of about $20,000 dollars within a single year. Coinbase informed the more than 13,000 account holders that their data will be shared with the IRS, the body charged with tax collection in the United states.
Although many cryptocurrency users believe that taxation is going against the true phylopies of bitcoin it is inevitable to avoid it for bitcoin to become mainstream. The tax law of many countries charges a small percentage of every business gains leaving the the business with an ample amount of profits to sustain its operations.
Many cryptocurrency experts are concerned that the government might in the future attempt to eliminate cryptocurrency by increasing taxes levied on cryptocurrencies to make people lose interest in it. How ever bitcoin design is sufficient enough to resist censorship by the authority while remaining a major commodity to its users.
It will become specifically hard for cryptocurrency platforms with physical offices to avoid government regulations especially those in countries with tough financial policies. These exchanges will be forced to abide by the set government regulation. There is also need for an alliance of the established cryptocurrency firms to form a strong negotiating voice with the authority.
Applancer is an open platform for discussion on all things like Blockchain , Cryptocurrency and Ico news updates. As such, the opinions expressed in this article are the author's own and do not necessarily reflect the view of Applancer .
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