Previous posts have talked about India’s interesting relationship with cryptocurrency. In 2018, India’s central bank, the Reserve Bank of India (RBI), had banned domestic financial institutions from providing banking services to cryptocurrency exchanges in India. In March 2020, the India Supreme Court struck down the RBI ban as unconstitutional. The report last month that the Indian government was weighing a proposal to impose an 18% goods and services tax on Bitcoin transactions was looked on…
Russia is continuing its unpredictable relationship with cryptocurrency. At one time, there was talk of the country banning cryptocurrency, though that never happened. Russia eventually legalized it, but did not allow cryptocurrency to be used to make payments. In December 2020, Reuters reported that President Vladimir Putin signed an order requiring that Russian public officials would have to declare cryptocurrency holdings starting January 1, 2021. Now, Coindesk and Coin Telegraph are reporting that, under a…
We have previously reported about how India’s central bank, the Reserve Bank of India (RBI), had banned domestic financial institutions from providing banking services to cryptocurrency exchanges in India, and how, in a decision on March 4, 2020, the India Supreme Court struck down the RBI ban as unconstitutional. Now, the Times of India is reporting that the Indian government is weighing a proposal to impose an 18% goods and services tax on Bitcoin transactions. …
At the start of the pandemic people wondered what the crisis would do to the crypto-asset market. As we left 2020, Bitcoin hit an all-time high and the crypto-asset world was moving into the mainstream and becoming subject to regulation around the world. On 16 December 2020, the FCA announced that cryptocurrency businesses that have filed to register with the FCA may continue operating under a temporary licensing regime for six months as the regulator…
There has been talk over the past month about the possibility of the Trump administration issuing certain requirements relating to crypto-wallets. Just the rumors led to pushback. On November 25, 2020, for example, Coinbase CEO Brian Armstrong tweeted explanations of why he believed this was a bad idea and how the additional friction of such reporting requirements would kill many of the emerging use cases for crypto. He added, “Just like the U.S. benefited enormously…
A mutual legal assistance treaty (MLAT) is an agreement between countries for the purpose of gathering and exchanging information in an effort to enforce public or criminal laws. It is often used to target crimes such as money laundering and drug trafficking. On November 4, 2020, the U.S. Department of Justice announced that, under an MLAT request from Brazil, it had seized virtual currency worth an estimated $24 million. According to documents filed in the…
Earlier this week, crypto-currency watchers noticed that there had been movement of about 70,000 Bitcoin from an account that had been dormant for many years. That mystery has now been solved. The U.S. Department of Justice announced on November 5, 2020 that it had seized the account. At the time of the seizure, the Bitcoin were worth more than $1 billion. According to the allegations of the civil forfeiture complaint, from 2011 until October 2013…
Under U.S. tax law, cryptocurrencies are treated like property. As a result, each time someone buys, sells or exchanges a digital asset, it is considered a taxable event and the capital gains tax applies. The Internal Revenue Service is of the view that many reportable transactions go unreported. One method it is adopting to try capture such taxes is that, starting in 2020, the very first question on the standard 1040 Form is whether “at…
Introduction On October 8, 2020, the U.S. Department of Justice (“DOJ”) released a Cryptocurrency Enforcement Framework (the “Framework”) authored by the Attorney General’s Cyber Digital Task Force. The Framework is the second detailed report authored by the Cyber-Digital Task Force addressing cryptocurrencies. The Framework provides a self-described comprehensive overview of what the DOJ considers to be emerging threats and enforcement challenges associated with cryptocurrencies. The Framework also details the collaboration that the Department of Justice…
On October 21, 2020, the Division of Swap Dealer and Intermediary Oversight (DSIO) of the United States Commodity Futures Trading Commission issued an Advisory to futures commission merchants (FCMs) regarding the holding of virtual currency in segregated accounts. The advisory provides guidance to FCMs on how to hold and report certain deposited virtual currency from customers in connection with physically-delivered futures contracts or swaps. The Advisory also provides guidance that FCMs should follow when designing…