Narz wrote:Anyone here made any money investing in bitcoins or other cryptocurrency?
Russian President Vladimir Putin has officially stated that Russia will issue its own ‘CryptoRuble’ at a closed door meeting in Moscow, according to local news sources. The news broke through Minister of Communications Nikolay Nikiforov.
According to the official, the state issued cryptocurrency cannot be mined and will be issued and controlled and maintained only by the authorities. The CryptoRubles can be exchanged for regular Rubles at any time, though if the holder is unable to explain where the CryptoRubles came from, a 13 percent tax will be levied. The same tax will be applied to any earned difference between the price of the purchase of the token and the price of the sale. Nikiforov said:“I confidently declare that we run CryptoRuble for one simple reason: if we do not, then after 2 months our neighbors in the EurAsEC will.”
Similar to bitcoin, the CryptoRuble cryptocurrency will be underpinned by a online ledger known as a blockchain. Unlike bitcoin, however, it will not be possible for people to mine the virtual currency—the process of confirming cryptocurrency transactions and adding their record to the blockchain in order to generate new units of the currency.
While the announcement means that Russia will enter the cryptocurrency world, it is in no way an affirmation or legalization of Bitcoin or any other decentralized cryptocurrency. On the contrary, Putin quite recently called for a complete ban on all cryptocurrencies within Russia.
"Cryptocurrencies are a fact of life ... We need to create a legal framework for these operations, we need to control these operations if these operations contravene the law, including money laundering legislation," Anton Siluanov, the minister of finance for Russia told CNBC on the sidelines of the International Monetary Fund meetings in Washington, D.C.
Speaking about the full range of digital currencies, not just bitcoin, he said that Russia is planning the state regulation of the mining, circulation and the buying and selling of these currencies.
This, he said, was not just to generate tax revenues but to protect the people and investors using cryptocurrencies.
His comments follow a recent flurry of discussion on cryptocurrencies from top figures in the business world. IMF Managing Director Christine Lagarde told CNBC on Thursday that there could be "massive disruptions" from digital currencies.
Cog wrote:How do you record this profit on your 1040? Do you get a capital gains statement from the Bitcoin exchange?
The reason I'm asking is that the IRS is going to look unfavorably at someone making a profit and not reporting that as a long or short term capital gain.
Narz wrote:Anyone here made any money investing in bitcoins or other cryptocurrency?
SeaGypsy wrote:Not me, some friends have. From what i can see, it's just a matter of time before government crackdown kills crypto currency. Nobody seems to know when, the holders all seem to think never.
Cog wrote:So essentially they are treating it like buying and selling gold or silver? Sort of up to the owner to declare it on the 1040. I suppose you can fly under their radar until a lot of money shows up in your bank accounts and the IRS wonders why. On the other hand if you exchange bit coins for products or services, it might not ever come to the IRS's attention unless the NSA is sharing their data collection with the IRS, which would not surprise me at all.
careinke wrote:Cog wrote:How do you record this profit on your 1040? Do you get a capital gains statement from the Bitcoin exchange?
The reason I'm asking is that the IRS is going to look unfavorably at someone making a profit and not reporting that as a long or short term capital gain.
Bitcoin is treated as a commodity by the IRS. Same rules apply. I use Coinbase as my exchange and can easily find my cost basis as all transactions are recorded.
careinke wrote:Narz wrote:Anyone here made any money investing in bitcoins or other cryptocurrency?
Yup.
BTW, I predict 1 Bitcoin will = at least one million US dollars within 15 years. Study up everyone. The Block chain is to money, as the Internet is to information. Right now we are about the same place as the internet was when Prodigy and 300 baud modems were the bleeding edge.
Outcast_Searcher wrote:careinke wrote:Cog wrote:How do you record this profit on your 1040? Do you get a capital gains statement from the Bitcoin exchange?
The reason I'm asking is that the IRS is going to look unfavorably at someone making a profit and not reporting that as a long or short term capital gain.
Bitcoin is treated as a commodity by the IRS. Same rules apply. I use Coinbase as my exchange and can easily find my cost basis as all transactions are recorded.
And that's fine IF such transactions are all properly reported. The problem comes in when people are trying not to report things, re the Silk Road exchange, illegal transactions they used to believe were completely transparent, and people trying not to report profits on bitcoin.
If the blockchain can now be reliably traced well enough to send 1099's for all bitcoin transactions to all US users (and I have my doubts, but in theory it could be if there were enough transparency and regulations to enforce that), then there's no problem -- once such regulations are implemented.
careinke wrote:Who is going to send those 1099's? It's a decentralized currency, it's not run like debt based fiat currency, no one is "in Charge." Reporting to the IRS is your responsibility not some bank.
You can do the same thing with cash, gold etc. Talking about government control of blockchain makes very little sense.
Video ... big banks and other industry players are finding ways to spin the new tool to their advantage.
Their blockchains share a vision that is precisely the opposite of the one laid out in the Bitcoin white paper [PDF], published under the pseudonym Satoshi Nakamoto in 2009. Like Nakamoto himself (or herself), you can own bitcoins without even stating your real name; nobody is in charge; and anybody can check the history of any given transaction. The financial industry’s blockchains, however, are closed or, in their jargon, permissioned; to join one you must reveal your identity to a system administrator, who must then approve you.
In the past two years, giants such as BNY Mellon, Goldman Sachs, ING, Santander, and UBS have explored dozens of blockchain projects, and some of those are now moving beyond the proof-of-concept phase. One of the first to be released into the real world will come from a little-known financial corporation Depository Trust and Clearing Corporation (DTCC) that mediates a US $11 trillion-a-year market for an arcane class of securities (Credit Default Swaps), the trading of which allows people to pay money to shed risk or make money by accepting it.
If all goes well, a far larger chunk of the quadrillion-dollar securities market, along with many of the administrative tasks performed by banks and brokerages, could soon be running on corporate blockchains.
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