Crypto Taxation In The US 

Crypto Taxation In The US
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Cryptocurrency is such an industry that works without the interference of any central authority or a central institution, like a bank, a monetary board, etc. with this, illegal activities within the industry and whitening of black money from outside the industry has been quite a common occurrence. With this, it becomes important to have a government authority to keep an eye on the transactions that happen on the blockchains. 

Let us see the US for example: One of the largest economies across the globe, the US is also a major contributor in the digital assets industry. American citizens do pay taxes on their crypto assets, as they are seen as a “property” in the taxation system. It works in such a way that the taxpayer is taxed on the amount that they have profited from. As in, if someone invests $10,000 in cryptos and gains a profit of $5,000, they will be taxed on the profit of $5,000 and not the total invested amount.

Also Read: U.S. Based Crypto Exchange Coinzoom Halts Russian New Account Applications 

Minting tokens may or may not be a taxable activity, a clarification by the IRS- Internal Revenue Service, is awaited. Many other aspects like liquidity, staking, deduction of loss, etc. also require working by the IRS. But in general, taxes are levied on two types of assets, short term gains and long-term gains. In short term profits, the assets that are taxed are held for less than a year and counterbalancing income tax is possible too. The tax on long-term gains is comparatively lower. 

This gives a clear message that the US wants their citizens to hold their assets for longer durations, possibly to counter the issue of volatility. Though the laws are implemented, widespread streamlining of crypto assets as a payment method is not that evident in the US. Established giants and the taxation policy is unfavorable for entrepreneurs to thrive their startups, but since it is such a dominant player, the US will have a huge influence on the industry nevertheless. 

Also Read: Bitgert (Brice) And Metaworld Pad (MWP) Price Increases By Over 200%

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