US in Crypto Tax Balancing Act, ETH Miners Safe Until Nov. 2021 + More News
Get your daily, bite-sized digest of cryptoasset and blockchain-related news – investigating the stories flying under the radar of today’s crypto news.
Crypto tax news
- The US Treasury Department has told attendees at the OECD-arranged 2020 Global Blockchain Policy Forum that it is still undecided about how to go about the declarations protocols involved with taxing crypto, and is yet to choose whether to focus on risk or on tax liabilities by reporting transactions. Per Bloomberg Law, Erika Nijenhuis, a senior counsel at the department’s office of tax policy, stated, “There are trade-offs among all [available models] and we are hard at work thinking about all of those issues.” Nijenhuis added that different models would place a varying degree of burden and benefits on crypto exchanges and other parties.
- Ethereum (ETH) Co-founder Vitalik Buterin recommends to wait until November of 2021 "or so" until the second-largest network by market capitalization might move from the current proof-of-work consensus mechanism, which involves mining and is also used by Bitcoin (BTC), to proof-of-stake (PoS). "The broader [E]thereum community, including the [ETH 1.0] core [developers], block explorers, exchanges, etc need to be convinced that PoS has been sufficiently de-risked that it's okay to fully switch over," Buterin wrote during an AMA session on Reddit this week.
- Hours after OKEx announced it’s going to resume withdrawals, the founder of OKEx, Star Xu (real name Xu Mingxing) confirmed on a private social media feed he had been cooperating with an investigation into an equity merger his blockchain company OK Group completed years ago, Bloomberg reported. He said the investee was the target of a “complicated” legal case, without elaborating.
- China’s digital yuan issuance plans could reap massive rewards for the country’s traditional financial sector, according to a report from Goldman Sachs. Per the document, uploaded by media outlet Coindesk, the token will likely “reach 1 billion addressable users” within 10 years of launch and “account for 15% of total consumption payments.” What is more, the authors wrote, “incorporating digital currency wallets into bank apps” will probably “level the playing ﬁeld […] for retail ﬁnance by bringing consumers back to bank channels.” And this, the authors noted, would “likely slow the rate that banks have been ceding ground to ﬁntech, and even reverse market share losses over the long-term if [the digital yuan] gains in popularity.”
- The demand for crypto mining hardware is on the rise again in Russia. Per media outlet Vesti, analysts at the e-commerce platform Avito, one of Russia’s biggest, discovered that there had been a sharp, 45% rise in demand for mining rigs in the country from October. The Avito analysts also found that there had been a decline in the number of new and used rigs being put up for sale.
Crypto adoption news
- German Finance Minister Olaf Scholz said he does not support private sector digital currencies, but acknowledged that it is essential to make Europe’s and Germany’s banking systems better fit for the digital era, Reuters reported.
- IMVU, an avatar social platform, said it received no-action relief from the Staff of the US Securities and Exchange Commission regarding the sale of VCOIN, IMVU’s new digital asset. VCOIN enables users to buy, gift, earn and, for the first time, transfer a digital asset off the IMVU platform to convert it to fiat, they said.
- Digital Asset Investment Management (DAiM), a licenced Registered Investment Advisor for crypto assets, said it has launched ERISA compliant employer-sponsored 401(k) plans with BTC. DAiM serves as the plan fiduciary and is responsible for selecting, managing, monitoring, and benchmarking the investment offerings.
- On Friday, in New Zealand, the Financial Sector Conduct Authority published a ‘draft declaration’ that defines crypto assets as a financial product under the Financial Advisory and Intermediary Services (Fais) Act, Moneyweb reported. This means that anyone giving advice or acting as an intermediary would have to register as a financial services provider and comply with the requirements of the Fais Act, it added.