Being active in cryptocurrency, here are a couple of observations:
1. In most cases, cryptocurrency is not being used as currency at all.
2. Government regulation is right around the corner, and it is surprising how they are treating this “currency.”
3. Most investing right now are not aware of the tax implications. The IRS treats it as an investment such as stocks, and not as a “currency.“
4. The on-ramp is too steep for the vast majority of Americans right now, preventing it from becoming a widely used currency.
5. As a currency, it has way too much volatility. It is not ready for prime time to take the place of fiat.
The BIS estimates 2.2 trillion dollars trade every day. That is daily trade volume, not the amount held in accounts. I mentioned the subject of liquidity to a bitcoin fanboy and they had no concept of what that meant in real world trading or transactions. The number of credit transaction per day is huge. The transaction rates per hour/day are massive.
Bitcoin is a TOY for crypto nerds and gold bugs. It would crash and burn if it had to support if even a small fraction of currently used currencies and payment types used it.
3. Most investing right now are not aware of the tax implications. The IRS treats it as an investment such as stocks, and not as a “currency.“
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Can you give me a brief detail of the tax implications? I’m been a Bitcoin investor for 3 years. Never received a 1099. Never reported any income or interest earned. Never reported on Schedule D.