This week’s summary of various cryptocurrency news and developments:
The IRS is seeking records on Coinbase’s customers, who transacted between 2013 and 2015
In a surprise tax probe, the Internal Revenue Service (IRS) is attempting to obtain records help by Coinbase, a prominent company in the cryptocurrency world. The targets of the investigation are not directly named, but it is known the investigation focuses on users in the US who did not pay taxes on transactions involving digital currencies, specifically between 2013 and 2015. The moves comes years after the IRS declared bitcoin and other digital currencies were to be regulated in the future, as if they were property. Tax professions in the US attacked the IRS’s move claiming it is too vague, while Coinbase itself plans to fight the tax agency’s request in court to protect user privacy.
The filing came just days after the Treasury Inspector General determined the IRS’ strategy when it came to income related to virtual currencies needed improvement. According to a document taxpayers who “receive virtual currency as payment for goods or services must, in computing gross income, include the fair market value of the virtual currency, measured in US dollars, as of the date that the virtual currency was received”.
Blockchain, bitcoin’s biggest wallet provider, to allow people to buy and sell from the wallet
Blockchain is bitcoin’s biggest wallet provider, it merely employs 25 people, and it has over 50% market share right now. After the US elections, a lot of people decided to use bitcoin as a hedge against economic instability, which made its price surge, making the wallet provider hit records numbers in activity and transactions. In an interview, co-founder and CEO of Blockchain wallet revealed that the company, in a partnership with Coinify, wants to launch a new feature that will allow users to buy and sell bitcoin from their wallets. The expect result of this new feature, allied with Blockchain’s prominence in the market, may make bitcoin’s value go through the roof.
ChangeTip, a bitcoin tipping service, shut down after a few employees got hired by Airbnb
ChangeTip is a bitcoin tipping service that aimed to bring bitcoins tips to most popular web platforms such as Twitter, Facebook and Twitch. The company managed to raise $3.5 million in a seed funding round, but a few months ago its core development team was hired by Airbnb. Since then, the platform attempted to find a solution for the service but claim they failed to do so and, as such, the only reaming option is to shut down. The service will remain online for a while longer so users can withdraw their funds, and withdrawals will be processed once every 24 hours. Users can also donate their money to charity when they close their account.
Bank of Japan: Blockchain may create tax issues and change the way banks conduct monetary policy.
Hiroshi Nakaso, Bank of Japan’s deputy governor, spoke at the University of Tokyo about FinTech this week, and in his speech he talked a lot about the benefits and risks of the digitalization of financial services. According to his statements, if FinTech stimulates economic transactions through the internet, then it would become more and more difficult to pinpoint the locations in which transactions actually take place. This would lead to issued revolving around regulation and taxation. He then closed his speech calling for greater collaboration in FinTech.
Dubai to discuss bitcoin regulation in a one-day conference
The Supreme Legislation Committee in the Emirate of Dubai, and the Dubai Electronic Security Center, are to hold a one-day conference in which bitcoin regulation will be discussed. The conference will be called “Virtual Currencies, Fact and Law” and will be held on the 20th of November. Government officials and national jurisdictions are expected to attend. According to CoinDesk, the Secretary General of the Supreme Legislation Committee said the move is part of their efforts to build legal knowledge and strengthen their legal system. Dubai has, in the past, researched FinTech and possible usage for blockchain technology.
Bitcoin at $750, nearly beating its 2016 record
A lot of things happened in favor of bitcoin this week. While the Chinese Yuan devalued and Donald Trump became the 45th president of the United States, bitcoin came a baby step closer to mainstream adoption, while being used to hedge against economic instability. This means in one hour, the price went up nearly $30, and overall managed to hit $750 at the time of publishing.
In India, one bitcoin was worth over $900, as the country banned two of the biggest fiat banknotes in the country, rendering a lot of the country’s physical cash completely obsolete, in an attempt to fight corruption, money laundering and terrorism.