August 6, 2021
Congress’s latest infrastructure bill, which included crypto tax measures at the last minute, could bring about the legitimizing of cryptocurrencies in the established financial community, according to MoffettNathanson Partner Lisa Ellis, Yahoo Finance reports.
She further explains what difficulties cryptocurrencies pose for legitimization: “What’s been holding up the crypto ETFs is that the SEC has very stringent requirements for things like liquidity, transparency, price stability.”
The rules that are common knowledge for those who invest in stock apply to cryptocurrencies as well, so people should be more aware and start reporting the cryptocurrencies on their tax return, otherwise, there is a great chance of becoming subject to an audit.
Ellis thinks that these new measures will decrease crypto activity for some time, but looking at the long-term investing in cryptocurrencies the result will be positive.
The Expected Benefits
The SEC Chair Gary Gensler, explained in an interview for Bloomberg, that keeping track of cryptocurrencies will offer people protection against fraud.
“More crypto clarity around crypto regulation helps legitimize and mainstream crypto investing, opening up crypto investing to a much broader array of … mainstream investors,” Lisa Ellis adds.
The recognition of crypto taxes in such an important legislation bill could pave the way to greater clarity in the legislative environment concerning the cryptomarket. If there is greater transparency, the private sector will likely incorporate crypto in a number of ways in the future.
At the beginning of 2021, Elon Musk, Tesla CEO, stated that his company will accept cryptocurrency, bitcoin to be precise, as payment and made a large investment of $1.5 billion in cryptocurrencies which only made other companies follow suit. Square Inc., a digital payment giant, and Microstrategy, a worldwide leader in enterprise analytics and mobility software, started amassing crypto assets in recent years, too.
While some companies purchase a large amount of cryptocurrencies, virtual trading platforms such as Robinhood enable customers to trade bitcoin and other cryptocurrencies on their platforms. According to experts, they think cryptocurrencies are an unstoppable force and they have already seen immense growth in the economy.
As crypto presents itself as the new future of finance, many corporations will start acquiring crypto assets.