Cryptocurrency has raised up to 300% in over just a year. What has brought this wild storm? The Craze about the internet and the happenings on it has made cryptocurrency and Bitcoin a phenomenon. This cryptocurrency has created a mayhem worldwide. Regulators all around the world have begun to address the challenges given by it that mostly bypass regulated banks, financial firms, exchanges and the central clearinghouses. In the US, the Securities and Exchange Commission and the Commodity Futures Trading Commission have sent a number of announcements in the last few months regarding cryptocurrencies. It is still a huge topic on everyone’s fingers. At some places, it is accepted as a mode of payment whereas others are completely confused about what it really is.
The Securities and Exchange Commission (SEC) has not approved of any exchange-traded products holding cryptocurrency for listing or trading. In July, 2017, the SEC issued a notice about the Initial Coin Offering saying that they can be ‘fair and lawful investment opportunities’. Several States plan to approve the acceptance or promotion of the use of Bitcoin and the decentralized blockchain technology, whereas some of them have already given their approval. The Internal Revenue Service say that the bitcoins must be treated as a property for tax purposes. Now, we all know that people become grumpy right at the mention of the word tax. Here as well, this means a ‘capital’ gain or loss would have to be recorded as if it were an actual exchange involving real property.
Electronic payments had been a part of US since 1871, but that is a lot different from virtual money. The difference is made in one single line; these virtual currencies do not ‘represent’ a claim of value like the traditional digital transfer, but rather the virtual currencies are the said value. The capital, ie, Washington DC is trying to regulate bitcoins but people are trying to stop it at all costs. The final call is yet to be made.