IRS to Revise Form 1040 to Make it Harder for Traders to Escape Crypto Tax Obligation

The Internal Revenue Service is planning to change the 2020 tax form and make sure all taxpayers report about their cryptocurrency transactions.

The standard 1040 form will be altered by adding the following questions on the front page:

At any time during 2020, did you sell, receive, send, exchange or otherwise acquire any financial interest in any virtual currency? And the taxpayer is required to check the box “Yes” or “No.”

“This placement is unprecedented and will make it easier for the IRS to win cases against taxpayers who check ‘No’ when they should check ‘Yes,’” says Ed Zollars, a CPA with Kaplan Financial Education.

The Wall Street Journal first reported the adjustment on Friday, noting that the question was previously, in 2019, in a spot that not all taxpayers had to fill out. But now it has been moved just below the taxpayer’s identity.

With this, the IRS is stripping any excuse for ignoring the rules. This also means, whoever fails to pay the taxes they owe on crypto transactions can be subject to penalties and, in some cases, even criminal prosecution.

“Primarily based on what we’re seeing, individuals are beginning to get scared,” said Chandan Lodha, the chief working officer of Cointracker, a software program firm promoting crypto tax-prep providers.

The tax agency has been focusing on virtual currency transactions for some time now. Just earlier this month, the IRS issued guidelines clarifying how cryptos are treated for tax purposes when received in exchange for certain services. An individual has to report the digital currency as ordinary income for receiving it through a crowdsourcing platform in exchange for providing a service, as per the memorandum.

In late August, it had also been affirmed that taxpayers must declare their cryptos as income, which were obtained for “microtasks.”

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Author: AnTy

Here’s Why Despite Sluggish Price Movement, Bitcoin is Immensely Bullish

Since recovering from the March lows, bitcoin has been struggling to make its way upwards. We tested $10,000 — the important psychological level numerous times only to fail and get stuck in a range.

Bitcoin refuses to attain five-digit value despite the central bank pumping money into the market. This time, investors are putting all the cash either into their bank deposits or pumping the stock prices, even of the bankrupted companies.

However, the bitcoin market is busy hodling; as such, Rafael Schultze-Kraft, CTO at crypto data firm Glassnode, is “extremely long-term bullish” on the world’s leading digital currency who advises not to get distracted by short-term price action and to look at the bigger picture.

Schultze-Kraft also shared a series of charts that depict this increased hodling behavior and investor confidence, starting with the record amount of bitcoin supply, 61% that hasn’t moved in over a year. This all-time high is a clear indication that investors are anticipating higher value in the future.

Also, 44% of BTC supply hasn’t moved in over two years, which is again approaching ATH, and almost 30% supply hasn’t moved in more than three years.

The average Coin Days Destroyed has been decreasing since the 2017 bull run and is currently at its lowest levels since 2016 — the lower the CDD, the more the long-term hodlers.

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In a similar manner, Bitcoin Binary Coin Days destroyed, which are the number of days per year in which coins were destroyed compared to the historic average, has never been this low as in 2020.

Another factor showing high confidence of long-term bitcoin investors is the Reserve Risk, which at the current level indicates an attractive risk/reward ratio to invest.

Long-term holder MVRV is also “looking strong” which usually drops below 1 after prolonged bear markets. MVRV long/short diff. crossovers indicate moments when average short-term and long-term traders move into profit territory. It tends to be a psychological barrier for many traders, which often kick FOMO and greed, as per Santiment.

Liveliness indicator that increases as long-term holders liquidate positions and decreases as long-term investors accumulate to HODL has been on a downward trend since 2019.

In fact, the number of hodled and lost bitcoins increased by 8% since the beginning of 2019 and is currently at over 7.3 million — 40% of bitcoin’s circulating supply.

HODLers are heavily accumulating this year, with only 16 days being the ones in which BTC Hodler Net Position Change has been negative.

glassnode hodl
Source: Glassnode

Amidst this, the average age of bitcoins moved on-chain is constantly decreasing since 2018, as per the Median Spent Output Lifespan (MSOL) indicator.

The amount of bitcoin transferred on-chain meanwhile has stagnated since 2016 despite the growth of the network which Schultze-Kraft says “is a clear indication of Bitcoin’s SoV narrative,” because investors aren’t willing to spend their BTC.

Adding to this narrative is bitcoin velocity, which measures how quickly units are circulating in the network. It has dropped to the lowest point in ten years.

As we have reported, bitcoin balance on exchange has been declining since March, which in part could be investors’ choosing to take custody of their own BTC.

So, overall, the market is long-term bullish and stacking sats waiting for the next big bull run.

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Author: AnTy

NYDFS To Ease Bitlicense Approval Process as the Crypto Regulation Turns Five

The New York Department of Financial Services (NYDFS) has suggested modifications to Bitlicense’s issuance to make the state more crypto-friendly.

This license – introduced in 2015 – is now five years old, and has dramatically impacted crypto operations in New York since its introduction. While most crypto businesses view it as an obstacle, some companies find it to be within an achievable scope for compliance.

Currently, only 25 crypto firms have been approved by the NYDFS to carry out business in the big apple. The approval might, however, change given new proposals that seek to introduce conditional licenses and self-certifications as part of smoothening the approval process.

Going forward, crypto entities such as Bitfinex and Shapeshift, which terminated their New York operations following the Bitlicense roll out could make a gradual return to the lucrative market.

Conditional Bitlicense

This initiative will allow crypto firms looking to enter the New York market to obtain a conditional license by working with entities whose Bitlicense was already approved. According to the NYDFS’ logic, a firm that gets a provisional license will eventually seek the Bitlicense as it scales operations:

“DFS expects that an entity that seeks a Conditional License will endeavor to eventually seek and obtain a full BitLicense.”

Consequently, the new market entrants must document their intention to work with a Bitlicense holder. This will then be reviewed by the NYDFS coupled with a follow-up should an entity be granted the conditional license. In the event where a provisional license holder goes astray, NYDFS can step in to discontinue the approval.

Self-Certification

To further advance its impact, the NYDFS has introduced a guideline on self-certification for crypto assets that are still in the pipeline.

However, this only applies to licensed entities and will need the approval of at least three firms to self-certify that a crypto asset meets NYDFS rules. Linda Lacewell, an NYDFS Superintendent, said that this move is meant to boost crypto businesses while maintaining proper oversight:

“We want to regulate … as much as we have to and not a drop more because businesses need to do business and they need to operate.”

State of Crypto Business in New York

As mentioned earlier, the Bitlicense has significantly shaped New York’s crypto ecosystem. Notable players that currently operate under the ‘strict’ measures include Circle, BitFlyer, and Bitstamp.

According to BitFlyer’s Chief Compliance in the U.S, Dave Zacks, the approval process was, however, not easy and took almost a year:

“We don’t know how many applications NYDFS has under review currently, but the requirements are strict, and a lot of newer smaller entities don’t have the capital or capability to meet those standards.”

Nonetheless, crypto stakeholders eyeing the New York market can now try their luck with better odds. Such a move would not only be beneficial in terms of market share but also in building a trustworthy business having qualified to operate in the world’s financial hub.

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Author: Edwin Munyui

Coinbase Open-Sources ‘Rosetta’ Used to Integrate New Blockchains For Listing

Coinbase is going open source and has launched Rosetta that will make integrating with blockchain simpler, faster, and more reliable.

“At Coinbase, we believe a thriving and open ecosystem is necessary for the promise of crypto to be realized, ultimately leading to our vision of more economic freedom for the world,” announced the US-based cryptocurrency exchange.

Back in 2016, the company thought of going open source, and it was only last year that they outlined its strategy. And now, it has launched Rosetta.

Rosetta was initially developed as the middleware to integrate blockchains into its platform securely, which they have now finally released.

The goal here is to standardize “how to interact with blockchains.” Making it easy for anyone to build on top of a blockchain for a variety of use cases, given that the number of blockchains has grown dramatically.

This interface will make it easier for developers of new blockchain projects to ensure compatibility with exchanges that use Rosetta, the company said. Besides speeding up the time of integration, it will protect customer funds by ensuring specific security conditions are met.

As for the broader community of crypto developers, it will help them in building cross-blockchain applications such as wallets, dapps, and block explorers. Coinbase said,

“Rosetta enables blockchain projects to 1) onboard faster with exchanges and apps; 2) build while ensuring strict security constraints are met, and 3) grow adoption by making code predictable & easier to debug.”

Currently, the framework is open-sourced to projects that are looking to get their tokens listed on the exchange. Coinbase’s goal is to decrease the time spent in bringing a blockchain onto the exchange.

Currently, there are a number of projects using this open-source software; Filecoin, Celo, Near, Oasis, Coda, Ontology, Kadena, Handshake, Blockstack, and Sia.

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Author: AnTy

DapperLabs’ CryptoKitties Moves From Ethereum To Its Custom Made Flow Blockchain

  • CryptoKitties, one of the most popular crypto collectable games developed by Dapper labs is all set to make its move to the Flow blockchain from its current platform Ethereum.

CryptoKitties made headlines when it partnered with the NBA to create digital collectables for the NBA and players. It also crashed the Ethereum network when it was launched back in 2017. The game would remain interoperable with Ethereum but it would move to flow with new upgrades and game features.

The new features would include animated 3D attributes, scalable nature due to the custom-built blockchain and users could also use the digital assets of the game in other games on the Flow blockchain.

While scalability was one of the key reasons behind the move to Flow, the CEO of Dapper Labs, Roham Gharegozlou, also mentioned that the platform was getting costlier for generating new cats in the game. The CEO further explained:

“Everyone on Ethereum will be able to take their cat to Flow. They’ll get upgraded powers, and will be able to be used on all kinds of Flow applications. The vision we had with KittyVerse: Hats on Cats, Kitty Races…will be much easier to be created around the kitties, in a way that millions of people, hundreds of millions of people can actually play with.”

DapperLabs Aims to Make Digital Collectables A Valuable Asset

The move to Flow is seen as a small step towards a long term goal of making digital collectables mainstream and valuable. Dapper Labs aims to continue in its aim of providing its users with true in-game ownership, thanks to its underlying Non-fungible tokens. All of which can be traded, exchanged and used to play within the game and community.

Dapper Labs hopes that as development progresses, and people and developer communities realize the potential, more games with similar digital collectables will be launched on Flow, making it a complete ecosystem and a marketplace of its own.

In the past couple of months; in the run-up to the Flow launch, Dapper Labs made several new announcements and promotional events.

It also invited developers to its new platform PlayGround and created a new programming language called Cadence specifically meant to ease the process of developing new smart contracts for creating Non-Fungible Tokens on the Flow blockchain.

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Author: Silvia A

BTC HODLers (Over 1 Year) Climb to An All-Time High During Market Turmoil Ahead of The Halving

The world’s leading cryptocurrency is back to showing some movement as we make our way back above $7,000, going to $7,143.

While BTC is still down 3.76% YTD, altcoins like Kyber Network (163%), Hedera Hashgraph (138%), DigixDAO (98%), BSV (97%), and Chainlink (95%) are yet reporting substantial gains.

Interestingly, $912 million worth of Tether (USDT) is currently being exchanged on top ten exchanges with real volume in the past 24 hours compared to Bitcoin’s $883 million, as per Messari.

Today’s gains, however, have been yet again alongside stocks just as oil prices started rebounding.

After about a 5% drop earlier in the week, Dow and the S&P 500 rose 1.9% on Wednesday. The selling has been triggered by a collapse in oil prices which dipped below zero for the first time. Today, some stability returned to the market with the price of international benchmark Brent crude and the American benchmark West Texas Intermediate crude sharply higher.

US Treasury bond prices meanwhile fell signaling that investors are yet again turning back to riskier investments. Moreover, the US Senate has passed a bipartisan $484 billion coronavirus relief package for distressed small businesses.

As for Wednesday’s first-quarter earnings report, Delta Air Lines had its first quarterly loss in years. Netflix’s shares fell after hitting a record high last week over increased demand anticipation which was met with countries in lockdown.

Bitcoin must remain above $6,200/$7,000 zone

Bitcoin that has a market cap of $130 billion, the same as Tesla along with other digital assets remained somewhat isolated from the latest market crash led by oil.

While the leading digital asset is keeping steady, it didn’t reclaim the key upside levels either all the while the hash rate of the network is back near all-time highs with mining difficulty making a big positive adjustment.

“The market may have been unable to stage the much sought-after rally, but it also remained somewhat resilient and prone to unexpected swings,” noted Denis Vinokourov, head of research at crypto investment brokerage, Bequant.

According to him, the market needs to remain above the $6,200/$7,000 zone because “below that the next support is not seen all the way to the low $5,000 zone.”

But in the current market turmoil, everything is possible, with everything from interest rates, oil futures, to yield going inverted amidst QE, surging employment, and massive bailouts. In such an event, Gabor Gurbacs of VanEck said, bitcoin “seems to make more sense than most markets.”

Bitcoin halving is also now less than 20 days away that will cut down its inflation in half. Price-wise, we can still go lower as trader Crypto Michael said,

“Funny, equity markets go up, BTC go up. The push even came slightly before equity markets opened.

In interesting resistance areas here. Weekly open + yearly level above us. Reclaiming them and I’be interested for longs, but overall expecting retest $6,900.”

Meanwhile, before this big event, the number of addresses holding BTC for more than a year is currently at their all-time high.

“On April 21, 18.99 million addresses were holding 10.83 million BTC for over a year. This number is 25% higher than the same date last year,” noted IntoTheBlock.

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Author: AnTy

Coinbase Upgrades Wallet App to Simplify Crypto Transactions In A Bid to Boost Adoption

Coinbase exchange has announced an upgrade of its digital wallet in a bid to make crypto transactions much easier. According to a blog post on April 8, the firm intends to create an ecosystem where sending or receiving digital currencies will be initiated with only a few taps. This will be facilitated in over 100 countries supported by Coinbase as well as transfers to other crypto wallets.

The new changes were made on the platform’s interface and are set to improve three major front-end functions within Coinbase. They include discoverability, execution, and confidence while leveraging Coinbase for its crypto trading services.

With the new upgrade, Coinbase users can initiate a crypto transaction through the action button as long as they are operating anywhere on the app. The update will further facilitate quick and simple currency swaps giving an opportunity for new users to intuitively navigate the Coinbase ecosystem. Finally, the exchange cleaned up its visual design; this will allow more transparency and build confidence as users will better understand the underlying of their crypto transactions.

Following this milestone, Coinbase is optimistic that it will enhance its service delivery to realize an open financial ecosystem as envisioned. The blog reads,

“Along with helping you manage your crypto and earn rewards, we believe sending and receiving will be a critical element of the open financial system.

We are excited to make this service accessible to more customers on Coinbase.”

Coinbase’s Recent Changes

This exchange has made a number of fundamental developments since the year began. Last month, Coinbase updated its address features to accommodate simple usernames such as @BEG instead of the normal complex string of characters.

Coinbase also introduced Bitcoin batching to free up space within its network and save on operational costs. This move was however criticized by some crypto stakeholders who noted that the exchange was late to game given its peers had integrated this feature two years earlier.

Another notable milestone is Coinbase Pro which was launched on android for advanced and pro traders. The San Francisco based crypto exchange is currently among the leading platforms in daily volumes traded globally.

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Author: Edwin Munyui

Crisis Investing 2020 Docu-Series on Financial Markets Set to Release

Crisis Investing 2020 is a series of episodes for investors. The episodes teach you how to “make life-changing money” while markets are crashing.

Crisis Investing 2020 claims to teach you the secrets that rich people use to take advantage while ordinary people scramble. The 2008 crisis gave rise to plenty of millionaires and billionaires. Will we say the same thing about the 2020 financial crisis?

You can sign up for Crisis Investing 2020 for free today at CrisisInvesting2020.com. Just enter your name and email address.

Crisis Investing 2020 is free. After entering your email, you will receive a link to each episode. The episodes stay online for 24 hours.

The first Crisis Investing 2020 “Docu-Cast” will appear online on April 7, 2020.

Let’s take a closer look at everything to know about Crisis Investing 2020.

What is Crisis Investing 2020?

Crisis Investing 2020 is a nine-part online docu-cast that teaches viewers how to capitalize on an economic crisis.

By picking the right investments today, investors can safeguard their portfolio and take advantage while others flee the market.

The team behind Crisis Investing 2020 claims to have gathered “the world’s elite money minds all in one place” to create the documentary series.

Crisis Investing 2020 is being published online for free, with the first episode scheduled to air on April 7, 2020.

What will You Learn from Crisis Investing 2020?

There’s limited information online about what you’ll learn in Crisis Investing 2020. However, here are some of the things we know will be included in Crisis Investing 2020:

  • The playbook that the rich use during economic crises to continue getting richer
  • The investment strategies you can use to capitalize on the 2020 economic crisis (or any other economic crisis)
  • The moves you should make while the masses “panic and freeze”
  • Information on investments in real estate for profit and cash flow
  • What to do with your failing financial assets, including the time to buy, sell, and hold
  • Current tax liabilities investment opportunities and the advantages and learn how to recoup or defer thousands of dollars from this
  • How to gain stable businesses at extremely low prices to generate cash flow for life
  • What’s really going on in our current economy and state of the crisis from a former White House economist
  • The best trades to make when a crashing market is in free fall
  • Option strategies with big returns
  • The businesses that will survive and make strides during this crisis to become the next Amazon or Netflix

Overall, Crisis Investing 2020 makes big promises about its effectiveness. The sales page for Crisis Investing 2020 asks you to imagine what it would be like to have $10 million in the bank, for example. Targets like this are attainable by following the lessons in Crisis Investing 2020 – at least, according to the team behind Crisis Investing 2020.

Who’s in Crisis Investing 2020?

Crisis Investing 2020 claims to feature “the world’s elite money minds all in one place”. However, the sales page for the docu-series does not mention any specific names.

We have no idea who will appear in Crisis Investing 2020 – or why those people are qualified to give you investment advice.

Why is Crisis Investing 2020 Free?

The creators of Crisis Investing 2020 are publishing the documentary series online for free because, in their words, people should have this critical information during a time of crisis:

“Why free? You deserve this critical information and we’re committed to making sure every single person that needs it has access during this crisis.”

Of course, the real answer is that the team is building an email list it will use to sell you products in the future (we assume).

However, it’s not totally clear what types of products will be advertised to this email list. The last documentary released by this company, Supplements Revealed, sold packages of supplements to viewers (like the $250 Gold Package, which included supplements and online guides).

Despite what Crisis Investing 2020 tells you, the company is not releasing this documentary out of the goodness of their heart: the company wants to sell you products and make money. The documentary is more of an advertisement than an objective documentary. However, one can not refute the high profile, next level caliber of people they have in the all-star line up of people being interviewed who share their insights and analysis on the current financial market landscape.

Who’s Behind Crisis Investing 2020?

Crisis Investing 2020 was created by a Park City, Utah-based company called Revealed Films, Inc.

There’s limited information online about Revealed Films. However, we know the filmmaking company is led by Jeff Hays, who also publishes movies under the name Jeff Hays Films.

Previous documentaries from Jeff Hays and Revealed Films have included FahrenHype 9/11, GMOs Revealed, Christ Revealed, Money Revealed, and The Healing Miracle.

Revealed Films has a subpar rating on the Better Business Bureau website, with multiple customers in the past three months (December 2019 to March 2020) complaining about ordering problems and refund issues. However, the company and names above all have reputable backgrounds and have been putting together similar style documentaries and movie films that tell a story by collectively getting the biggest and brightest to share perspectives and forward-thinking feedback.

Final Word

Crisis Investing 2020 is a free, nine-part documentary series that teaches people how to make smart investments during a time of crisis – like the current COVID-19 coronavirus pandemic that has sent markets into turmoil worldwide.

Crisis Investing 2020 promises to teach you the strategies that rich people use to get richer during an economic crisis.

You can sign up to view the documentary series online through CrisisInvesting2020.com.

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Author: Andrew Tuts

Ripple Donates $200k to COVID-19 Emergency Response Fund; Crypto Companies Stepping Up

The San Francisco-based Ripple is the latest company to make donations to the novel coronavirus response fund.

The company took to Twitter to share that they had donated $100k donations each to the COVID response fund by Silicon Valley Community Foundation and Tipping Point Community.

“In these challenging times, Ripple is committed to being part of the global response to the COVID-19 pandemic. We’re starting in our own backyard with $100K donations each to @tippingpoint’s COVID emergency response fund and @siliconvalleycf’s COVID Regional Response Fund,” tweeted Ripple.

Binance to Donate Millions to Worst Affected Countries

Ripple is not the first company in the crypto space to do so. A few days ago, Binance Charity, the donation arm of leading crypto exchange Binance announced a project titled ‘Crypto Against COVID’ through which it is looking to raise $5 million in cryptos (BTC, BNB, XRP, and BUSD).

Binance will make an initial donation of $1 million USD and further commits to donating up to $2 million and match $1 million USD of public donations received. The funds will be used to buy medical supplies for the countries worst affected by the virus.

“The crypto community is a growing force and we have an opportunity to strengthen this through philanthropy. We encourage the community to take part in this initiative as we unite against COVID-19, and together, we’ll drive impact,” said Binance founder and CEO Changpeng Zhao.

In January, Binance also launched “Binance for Wuhan” and donated about $1.4 million worth of medical supplies to support China in its battle against the COVID-19.

Tron Foundation also sent shipments of medical supplies to China earlier this year.

Emergency Funds to Help Startups

A few days ago, the Giving Block crypto charity was also launched where donations were made in cryptocurrency to non-profit partners.

“Today, donating cryptocurrency is not just a way to lower our taxes. It is our chance to protect the people we love, all while telling the new crypto story,” said Alex Wilson, CEO of The Giving Block.

An emergency fund by CNBC’s CryptoTrader host Ran NeuNer in collaboration with Yossi Hasson of Techstars has also been created to help the startups affected by the COVID-19 outbreak. The fund has raised $10 million so far.

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Author: AnTy

Vitalik Buterin Calls Popular Bitcoin Stock-to-Flow (S2F) Model “Rationalized bulls—t” Vitalik Buterin Calls Popular Bitcoin Stock-to-Flow (S2F) Model “Rationalized bulls—t”

  • “Event X (including stock-to-flow model) will make crypto go (up | down) are post-hoc rationalized bullshit,” – Ethereum co-founder Vitalik Buterin
  • “The proven cointegration is still there everybody can verify it, until you prove it wrong” – PlanB who uses S2F model to determine BTC value
  • Last week, Trezor also posed a question on the model saying “using Stock-to-Flow to predict prices is absolute nonsense”

Ethereum co-founder Vitalik Buterin dissed the stock-to-flow model that puts bitcoin’s value at above $100k before Dec. 2021 based on its scarcity. According to this model, the reward halving in May 2020 will make the digital asset more scarce than gold.

Buterin took to Twitter on Thursday to comment,

“Your daily reminder that 95%+ of articles of the form “event X will make crypto go (up | down)” are post-hoc rationalized bullshit.”

In response to this, analyst PlanB, who first used this model to determine bitcoin value said,

“You can call stock-to-flow model rationalized bulls**t or absolute nonsense but that’s not how math/stats works: the proven cointegration is still there, everybody can verify it, until you prove it wrong. But I get Vitalik: liking S2F = saying ETH has no value, ofc he is a critic”

Bitcoin price has been following the Stock-to-flow model over its past 10-year journey even the ongoing crash below $8,500 has been “spot on model value”.

Using Stock-to-Flow to predict prices is absolute nonsense

Buterin is not alone in criticizing the model, many analysts have done so. The most recent one has been by crypto hardware wallet manufacturer Trezor.

Although mathematically the model looked “convincing” and the idea behind it was impressive, “using Stock-to-Flow to predict prices is absolute nonsense,” states the blog.

It argues that the price is the result of supply and demand. But the stock-to-flow model only takes the supply side into account. “If the demand for Bitcoin falls, the price will drop even at the same Stock-to-Flow.”

The article illustrates Bitcoin fork Bitcoin Cash for which the model doesn’t work because there isn’t any demand for it.

“If we knew Bitcoin had to moon because of the magical Stock-to-Flow and shoot up ten times with every halving, why aren’t we there yet?” The blog further argued that the model puts bitcoin value higher than the GDP of all countries in the world in a few decades. And sometime in future, an infinite value, “then a negative price of Bitcoin.”

The analyst PlanB has previously called that phase to be hyperbitconization when the dollar would fail to be used to measure bitcoin value. Trezor said,

“Scarcity is a necessary but not sufficient condition of value. The Stock-to-Flow model correctly draws attention to scarcity but omits the second necessary variable from the equation. As a result, it is unusable to predict the price and remains just a wish of all Bitcoin fans.”

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Author: AnTy