Cryptocurrencies may have started as something only for techies or people trying to skirt government regulations. Still, now crypto is increasingly useful both for spenders and for investors.
For a while, it seemed that governments were waiting for the cryptocurrency fad to die out. Although there were some early attempts to ban or regulate currencies like Bitcoin, they often failed. Now, however, as these currencies gain momentum, several countries are attempting to make changes.
Here’s what you should know about the current discussions about regulating Bitcoin and other cryptocurrencies.
Changes in the US
Early investors in cryptocurrencies like Bitcoin learned very quickly that crypto is a volatile investment. While other investments are limited to rules like trading hours, a crypto investor can see their investment multiply (or collapse) literally overnight.
Previously there was little regulation regarding Bitcoin, but legislators are now discussing rules that would require holders to disclose transactions over $10,000 to the IRS. The intent is to “close the gap” for transactions that would typically be taxed but have been flying under the radar.
The US is not the only place making changes
Other governments are also changing their perspective on crypto. Initially, New Delhi saw crypto as a threat and proposed a ban on all cryptocurrencies. However, more recently, officials are considering allowing “crypto traders” to access bank services.
China has a different perspective. Crypto miners were taking advantage of cheap electricity in China to house large Bitcoin mining operations. Now, officials are cracking down and forcing the closure of these companies.