Computers

U.S. Wants to Tighten Crypto Currency Regulations, Explores Own Digital Currency


When capitalization of popular cryptocurrencies hit trillions of dollars, they immediately attract attention of various government agencies and taxation authorities that aim to regulate and tax them. According to a report from Reuters, this week the U.S. Treasury proposed to treat cryptocurrency deals like cash deals and report all sizeable transfers to the Internal Revenue Service (IRS). Meanwhile, the head of the U.S. Federal Reserve said that cryptocurrencies pose risks to financial stability. 

For years. cryptocurrencies like Bitcoin, Ethereum, and Chia have been on an uncharted territory, hidden from the eyes of regulators and tax authorities. People who mine cryptocurrencies and buy certain products or services using them do not report about their income and spending. Since transactions are made in an de-centralized system, it is close to impossible for authorities to control it. Such an opportunity arises when people convert real money to crypto and vice versa, which is what happens when cryptocurrencies become investment instruments for millions of people worldwide. For obvious reasons, taxation authorities do not want to miss it.  


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