๐ฎ Will Trump make crypto tax-free?
๐บ๐ธ This week, the media discussed new possible changes in crypto policy that the Donald Trump administration can provide. He can cancel capital gain tax for all cryptos issued or registered in the United States. Gains from sale of cryptos like Ripple and Cardano will, in this case, be tax-free for US tax residents. This looks like a great move for the industry in the US.
๐Although this information has not been officially confirmed yet, it mainly refers to unnamed sources in the Trump team, so it could be a fake.
๐บ๐ธ This week, the media discussed new possible changes in crypto policy that the Donald Trump administration can provide. He can cancel capital gain tax for all cryptos issued or registered in the United States. Gains from sale of cryptos like Ripple and Cardano will, in this case, be tax-free for US tax residents. This looks like a great move for the industry in the US.
๐Although this information has not been officially confirmed yet, it mainly refers to unnamed sources in the Trump team, so it could be a fake.
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Do you think it's a fake?
Anonymous Poll
53%
It's a fake.
47%
It's true. And we will get confirmation soon.
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I've asked Trump and some GOP officials. Please, subscribe my X account to support this activity.
https://x.com/crypto_pen_on/status/1857841906362818892?t=DVBd0pNcEmDgSYwMK1IUqQ&s=19
https://x.com/crypto_pen_on/status/1857841906362818892?t=DVBd0pNcEmDgSYwMK1IUqQ&s=19
X (formerly Twitter)
Crypto Penetration (@crypto_pen_on) on X
@realDonaldTrump Mr. President, will your exempt gains from sale of US cryptos from tax? Is it fake or not?
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๐ช๐บ VASP transition to CASP
๐ Requirements for crypto entities in the EU are getting stricter under MiCA. Registered VASPs are obligated to get CASP (Crypto Asset Service Provider) license. Apart from the name change, this implies stricter licensing and auditing procedures - more restrictions and costs.
๐ The picture shows how many months different EU countries give for this transition.
๐ต๐ฑ๐ฑ๐นPoland, Netherlands, and Lithuania gave companies only half a year. Probably such small terms for Poland and Lithuania are caused by too many operating crypto entities in these countries and the desire of EU to introduce stricter control over VASP there. Probably the number of licenses in Lithuania and Poland will decrease significantly.
๐ On the contrary, France, Luxembourg, Malta, Estonia, Czech Republic and Cyprus (it is not in the table) have a long transition period for VASPs - 18-19 months.
๐ Requirements for crypto entities in the EU are getting stricter under MiCA. Registered VASPs are obligated to get CASP (Crypto Asset Service Provider) license. Apart from the name change, this implies stricter licensing and auditing procedures - more restrictions and costs.
๐ The picture shows how many months different EU countries give for this transition.
๐ต๐ฑ๐ฑ๐นPoland, Netherlands, and Lithuania gave companies only half a year. Probably such small terms for Poland and Lithuania are caused by too many operating crypto entities in these countries and the desire of EU to introduce stricter control over VASP there. Probably the number of licenses in Lithuania and Poland will decrease significantly.
๐ On the contrary, France, Luxembourg, Malta, Estonia, Czech Republic and Cyprus (it is not in the table) have a long transition period for VASPs - 18-19 months.
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๐ Bitcoin > $97,000 and $100k is waitingโฆ
๐๐๐ Bitcoin continues to update its ATH today, November 21, breaking through the $95k mark to reach over $97k. There is almost no doubt that $100k will also be breached this week, and most likely today.
๐ One of the main reasons is the changes in cryptocurrency regulation in the US. Donald Trump met with Coinbase CEO Brian Armstrong the other day and Bloomberg messaged yesterday about Armstrong's possible appointment as the White House's head of crypto policy. Meanwhile, Congress and the Senate are preparing to discuss a Bitcoin Reserve.
๐๐๐ Bitcoin continues to update its ATH today, November 21, breaking through the $95k mark to reach over $97k. There is almost no doubt that $100k will also be breached this week, and most likely today.
๐ One of the main reasons is the changes in cryptocurrency regulation in the US. Donald Trump met with Coinbase CEO Brian Armstrong the other day and Bloomberg messaged yesterday about Armstrong's possible appointment as the White House's head of crypto policy. Meanwhile, Congress and the Senate are preparing to discuss a Bitcoin Reserve.
Bloomberg.com
Trump Team Mulls Creating First-Ever White House Crypto Role
President-elect Donald Trumpโs team is holding discussions with the digital asset industry about whether to create a new White House post solely dedicated to cryptocurrency policy, according to people familiar with the transition efforts.
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๐ฝGreat resignation
๐ Gary Gensler will resign on January 20. He announced the news in his X account. Apparently Bitcoin will reach $100,000 pushed by this fact.
๐ Gary Gensler will resign on January 20. He announced the news in his X account. Apparently Bitcoin will reach $100,000 pushed by this fact.
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๐ท๐ด Romania attracts crypto users
๐ช๐บ Amid the implementation of MiCA in the EU and tough compliance rules, good news coming from Romania. The country's parliament has amended the tax code to eliminate tax on personal income from cryptocurrency transactions.
๐ The benefit will be valid until July 31, 2025. So if you want to live in the European Union, maybe you urgently need to get a Romanian residence permit.
๐ช๐บ Amid the implementation of MiCA in the EU and tough compliance rules, good news coming from Romania. The country's parliament has amended the tax code to eliminate tax on personal income from cryptocurrency transactions.
๐ The benefit will be valid until July 31, 2025. So if you want to live in the European Union, maybe you urgently need to get a Romanian residence permit.
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๐ปBitcoin price decline
๐ Today, BTC's price is moving down sharply. Currently, itโs about $92,500 and there is a risk of continuously drop to $90,000 and below.
๐ซณ The reasons are quite simple - Bitcoin didnโt break the $100,000 mark. In addition, there is a risk that the Fed will keep its current interest rate after its meeting on the 18th of December. However, in a volatile market like crypto, a reversal is always possible.
๐ฒ๐ฆ Despite the price decline, global regulation continues to improve - Morocco Central Bank plans to cancel its crypto ban.
๐ Today, BTC's price is moving down sharply. Currently, itโs about $92,500 and there is a risk of continuously drop to $90,000 and below.
๐ซณ The reasons are quite simple - Bitcoin didnโt break the $100,000 mark. In addition, there is a risk that the Fed will keep its current interest rate after its meeting on the 18th of December. However, in a volatile market like crypto, a reversal is always possible.
๐ฒ๐ฆ Despite the price decline, global regulation continues to improve - Morocco Central Bank plans to cancel its crypto ban.
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Tornado Cash case: will mixer regulation change?
The US Court of Appeals made a striking decision: it recognised OFAC sanctions against Tornado Cash as illegal. The Court's reasoning is that sanctions can be imposed on something that is property and belongs to someone, and immutable smart contracts are not on the list of property specified in the IEEPA law.
This is good news for the crypto industry and especially blockchain developers, as it limits the ability to sue them for creating code. Some go even further - they hope that this decision will change the approach to crypto mixers in the future (for instance). If so, it will lead to creation of legal โcoin anonymizersโ for large crypto holders and hedge funds.
TORN's value has multiplied by 12 after the Court's decision - from $3 to $36. More details about the Tornado Cash court case and its history are in my research.
The US Court of Appeals made a striking decision: it recognised OFAC sanctions against Tornado Cash as illegal. The Court's reasoning is that sanctions can be imposed on something that is property and belongs to someone, and immutable smart contracts are not on the list of property specified in the IEEPA law.
This is good news for the crypto industry and especially blockchain developers, as it limits the ability to sue them for creating code. Some go even further - they hope that this decision will change the approach to crypto mixers in the future (for instance). If so, it will lead to creation of legal โcoin anonymizersโ for large crypto holders and hedge funds.
TORN's value has multiplied by 12 after the Court's decision - from $3 to $36. More details about the Tornado Cash court case and its history are in my research.
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๐ณ๐ฑ ะกhange residence and pay exit tax
๐ช๐บ Another EU country will impose an โexit taxโ on citizens who move abroad. Last month, the Dutch parliament discussed such a legislative proposal to stop tax evasion, and most members supported it. The government will prepare a bill.
๐ This tax already exists (in various forms) in several countries around the world, including:
๐ Italy
๐ Spain
๐ Canada
โ๏ธ Finland
๐จ Australia
๐ฆ South Africa
๐งญ Norway
๐ณ๐ด Sweden
๐ซ๐ท Some countries are also considering stricter exit criteria, such as those proposed for 2025 in France.
๐งฎ Basically, it works as a tax on capital - shares, stakes in companies - and thus applies to cryptocurrencies as well. Such tax is paid if a person has lived in the country for (typically) more than 5 years and has an income of over $1 million (average figure). So if you are holding a bunch of crypto, you should be careful choosing your country of residence. Last, but not least, sometimes legal entities also pay exit tax.
๐ช๐บ Another EU country will impose an โexit taxโ on citizens who move abroad. Last month, the Dutch parliament discussed such a legislative proposal to stop tax evasion, and most members supported it. The government will prepare a bill.
๐ This tax already exists (in various forms) in several countries around the world, including:
๐ Italy
๐ Spain
๐ Canada
โ๏ธ Finland
๐จ Australia
๐ฆ South Africa
๐งญ Norway
๐ณ๐ด Sweden
๐ซ๐ท Some countries are also considering stricter exit criteria, such as those proposed for 2025 in France.
๐งฎ Basically, it works as a tax on capital - shares, stakes in companies - and thus applies to cryptocurrencies as well. Such tax is paid if a person has lived in the country for (typically) more than 5 years and has an income of over $1 million (average figure). So if you are holding a bunch of crypto, you should be careful choosing your country of residence. Last, but not least, sometimes legal entities also pay exit tax.
NieuwRechts
Emigreren? Dat kost je straks duizenden euro's aan belasting
De Tweede Kamer heeft een motie aangenomen die de invoering van een emigratiebelasting mogelijk maakt. De motie, ingediend door Laurens Dassen (Volt) en Pieter Grinwis (ChristenUnie), richt zich op he
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Do you think "exit tax" is good for crypto?
Anonymous Poll
47%
Indeed, not.
30%
Wealthy individuals should pay more taxes.
24%
In some form it may be OK. Depends on details.
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๐บ๐ธ US government is going to sell BTC?
๐ง According to Arkham Intelligence US government has transferred almost 20k BTC (about $1,9 bln) to Coinbase Prime. Probably, these Bitcoins will be sold soon.
๐ Some experts qualify this action as an attempt by the outgoing administration to reduce the amount of BTC on USA's balance sheet before the Bitcoin Reserve Act is passed. However, it's only 10% of current US Bitcoin holdings, so it may be simply a planned action.
๐ง According to Arkham Intelligence US government has transferred almost 20k BTC (about $1,9 bln) to Coinbase Prime. Probably, these Bitcoins will be sold soon.
๐ Some experts qualify this action as an attempt by the outgoing administration to reduce the amount of BTC on USA's balance sheet before the Bitcoin Reserve Act is passed. However, it's only 10% of current US Bitcoin holdings, so it may be simply a planned action.
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๐บ๐ธ New SEC chair
๐ฆ Donald Trump has nominated crypto lobbyist Paul Atkins as new SEC chair. Paul is leader of Token Alliance and was already SEC chair in 2002-2008.
๐ His nomination may push BTC price above $100,000 this week.
๐ฆ Donald Trump has nominated crypto lobbyist Paul Atkins as new SEC chair. Paul is leader of Token Alliance and was already SEC chair in 2002-2008.
๐ His nomination may push BTC price above $100,000 this week.
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Ethereum $4,000. Alt season in progress. ๐ ๐
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๐ช๐บ The EU implements MiCA and changes tax rates
๐จ EU member states have until the end of 2024 to implement MiCA requirements (adopt the necessary laws) to start the re-registration procedure of operating VASPs to the CASP regime (effective in 2025). So, summarising the year's results on regulation is in full swing here. And by the way, not all countries had time to pass all the necessary laws in 2024.
๐ MiCA will certainly complicate the life of crypto businesses in Europe, as well as users - with transactions in USDT and increased AML requirements. But it will create a legal framework and increase the level of investor protection.
๐ชจ There is another much bigger problem for EU users than MiCA: tax increases. Unfortunately, many Western European countries that have promoted themselves as cryptohubs (e.g. France, Netherlands) are raising tax requirements. And these plans have only now come to light.
๐ซ๐ท France has not only increased capital tax requirements for those who leave the country, but is also going to oblige holders to pay tax on unrealised profits at the end of the year. That is, cryptocurrency owners will owe the state for earned profits, regardless of whether they realise those profits (sell the asset) or not. Japan imposed a similar tax earlier, but then cancelled this requirement, as it was considered ineffective. And unfortunately, France may not be the last country to introduce such a tax.
๐ท๐ด On the contrary, Romania has announced crypto tax amnesty. Until mid-2025, the tax rate for individuals from the sale of cryptocurrencies will be 0%. Take the hint.
๐ฐ You can read more about how requirements for crypto business in Europe will increase in my new article on Hackernoon.
๐จ EU member states have until the end of 2024 to implement MiCA requirements (adopt the necessary laws) to start the re-registration procedure of operating VASPs to the CASP regime (effective in 2025). So, summarising the year's results on regulation is in full swing here. And by the way, not all countries had time to pass all the necessary laws in 2024.
๐ MiCA will certainly complicate the life of crypto businesses in Europe, as well as users - with transactions in USDT and increased AML requirements. But it will create a legal framework and increase the level of investor protection.
๐ชจ There is another much bigger problem for EU users than MiCA: tax increases. Unfortunately, many Western European countries that have promoted themselves as cryptohubs (e.g. France, Netherlands) are raising tax requirements. And these plans have only now come to light.
๐ซ๐ท France has not only increased capital tax requirements for those who leave the country, but is also going to oblige holders to pay tax on unrealised profits at the end of the year. That is, cryptocurrency owners will owe the state for earned profits, regardless of whether they realise those profits (sell the asset) or not. Japan imposed a similar tax earlier, but then cancelled this requirement, as it was considered ineffective. And unfortunately, France may not be the last country to introduce such a tax.
๐ท๐ด On the contrary, Romania has announced crypto tax amnesty. Until mid-2025, the tax rate for individuals from the sale of cryptocurrencies will be 0%. Take the hint.
๐ฐ You can read more about how requirements for crypto business in Europe will increase in my new article on Hackernoon.
Hackernoon
The EU in the middle of MiCA tunnel: any light?
MiCA, the EU's groundbreaking crypto regulation, harmonizes rules across 27 countries. It promises transparency but challenges stablecoins and startups.
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๐ The first wave of the bull cycle
๐บ๐ธ While more countries are adopting crypto regulation, the market is going through a full-fledged bull cycle after Donald Trump's victory, although altcoins are getting less liquidity than during the previous bull cycles of 2017 and 2021. Here's a look at some of the coins in the Coinmarketcap top 50, from 5 November to highs in early December, following Trump's appointment of the new SEC head, Paul Atkins:
๐ทXRP from $0.50 to $2.90
๐ทALGO from $0.10 to $0.50
๐ทBGB from $1.10 to $2.78
๐ทUNI from $6.70 to $18.64
๐ทDOGE from $0.15 to $0.46
๐ทATOM from $3.90 to $10.42
๐ทARB from $0.47 to $1.10
๐ทADA from $0.59 to $1.20
๐ทSUI from $1.85 to $4.32
๐ทDOT from $3.47 to $10.70
๐ทTON from $4.67 to $7.16
๐ทAVAX from $22 to $54
๐ทCRO from $0.07 to $0.21
๐ทPOL from $0.29 to $0.70
๐ทAPTOS from $8.00 to $14.29
๐ทNEAR from $3.60 to $8.00
โฏ๏ธ That is, almost no coin from TOP 50 has grown by more than 300% and the range is typically about 50-200%. Volatility in the crypto market is decreasing, making it more and more similar to other financial markets for this indicator. This is a sign of crypto institutionalisation.
๐ However, if we look at the figures for Bitcoin ETFs, liquidity continues to arrive there - over $3bn since 29 November and inflows exceeded outflows on every trading day. Nevertheless, the alt season has already largely taken place. It is possible that we are still waiting for a second bull market in early 2025, but those who are in positions now should be careful and distribute risks properly. Even if the second wave of the bull market awaits us, we should take into account the high probability of correction.
๐บ๐ธ While more countries are adopting crypto regulation, the market is going through a full-fledged bull cycle after Donald Trump's victory, although altcoins are getting less liquidity than during the previous bull cycles of 2017 and 2021. Here's a look at some of the coins in the Coinmarketcap top 50, from 5 November to highs in early December, following Trump's appointment of the new SEC head, Paul Atkins:
๐ทXRP from $0.50 to $2.90
๐ทALGO from $0.10 to $0.50
๐ทBGB from $1.10 to $2.78
๐ทUNI from $6.70 to $18.64
๐ทDOGE from $0.15 to $0.46
๐ทATOM from $3.90 to $10.42
๐ทARB from $0.47 to $1.10
๐ทADA from $0.59 to $1.20
๐ทSUI from $1.85 to $4.32
๐ทDOT from $3.47 to $10.70
๐ทTON from $4.67 to $7.16
๐ทAVAX from $22 to $54
๐ทCRO from $0.07 to $0.21
๐ทPOL from $0.29 to $0.70
๐ทAPTOS from $8.00 to $14.29
๐ทNEAR from $3.60 to $8.00
โฏ๏ธ That is, almost no coin from TOP 50 has grown by more than 300% and the range is typically about 50-200%. Volatility in the crypto market is decreasing, making it more and more similar to other financial markets for this indicator. This is a sign of crypto institutionalisation.
๐ However, if we look at the figures for Bitcoin ETFs, liquidity continues to arrive there - over $3bn since 29 November and inflows exceeded outflows on every trading day. Nevertheless, the alt season has already largely taken place. It is possible that we are still waiting for a second bull market in early 2025, but those who are in positions now should be careful and distribute risks properly. Even if the second wave of the bull market awaits us, we should take into account the high probability of correction.
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๐ช๐บ EU regulation crypto updates
๐จ๐ฟ Against the backdrop of growing requirements for crypto-business in Europe, the Czech Republic offers the opposite, exempting long-term holders from capital taxes. To take advantage of the tax exemption you need to hold crypto for 3 years. I think this is good motivation, especially as the benefit applies retroactively, to those who have already held for more than three years (though in Germany this period is 1 year).
โฃ๏ธ The requirements for opening bank accounts for companies in the Republic will also be simplified. Czech MP Jan Skopecek noted that โif crypto businesses are not provided with tax benefits, they may relocate to another countryโ.
๐ฑ๐ป Latvia now allows crypto companies to fund their capital directly in crypto. This Baltic country had no regulation until 2024, but adopted both new tax rules and a law on crypto assets this year. Financial technologies are quite developed here, but usually only back-offices of European companies are located in Latvia, due to complex compliance procedures.
โ ๏ธ Coinbase removes access to USDT, DAI and other stablecoins for all EU users. Only USDC and EURC will remain. Restricting Europeans' access to USDT and increasing requirements for obtaining CASP licenses are among the main drawbacks of MiCA.
๐จ๐ฟ Against the backdrop of growing requirements for crypto-business in Europe, the Czech Republic offers the opposite, exempting long-term holders from capital taxes. To take advantage of the tax exemption you need to hold crypto for 3 years. I think this is good motivation, especially as the benefit applies retroactively, to those who have already held for more than three years (though in Germany this period is 1 year).
โฃ๏ธ The requirements for opening bank accounts for companies in the Republic will also be simplified. Czech MP Jan Skopecek noted that โif crypto businesses are not provided with tax benefits, they may relocate to another countryโ.
๐ฑ๐ป Latvia now allows crypto companies to fund their capital directly in crypto. This Baltic country had no regulation until 2024, but adopted both new tax rules and a law on crypto assets this year. Financial technologies are quite developed here, but usually only back-offices of European companies are located in Latvia, due to complex compliance procedures.
โ ๏ธ Coinbase removes access to USDT, DAI and other stablecoins for all EU users. Only USDC and EURC will remain. Restricting Europeans' access to USDT and increasing requirements for obtaining CASP licenses are among the main drawbacks of MiCA.
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