What The Crypto Bill In Washington Means For Bitcoin And Altcoins?

Bitcoin, Ethereum, and the entire future of the digital currency landscape are facing the most pivotal moment since their inception, as they are the subject of scrutiny and potential sweeping new legislation that could alter the industry forever – at least how the industry itself develops in the United States.

As the financial epicenter of the globe, the United States, Washington, and Wall Street could play decisive roles in how things unfold forever more across the crypto industry. Depending on how heavy handed Washington politicians that don’t understand the emerging technology start to get, they could hinder innovation henceforth.

But with the right guardrails in place innovation can flourish, and the sector can continue to thrive as it has over the last decade. Not only will such guardrails improve the safety for participants of the crypto market, but it will also legitimize the industry in ways unlike ever before.

In fact, with cryptocurrencies like Bitcoin and Ethereum in the public eye and on capitol hill, all before a digital dollar ever emerges, is the most bullish and legitimizing situation yet for the asset class. Here is more on what the milestone legislation means for the crypto market and the assets that trade within it.

Investors And Traders Are Confused Over Sudden Tax Burden

An enormous deal is being made by crypto investors and traders who don’t quite understand what the bill is all about. They falsely believe that they’ll suddenly be subject to paying taxes if the law passes, but the truth is they were responsible for reporting cryptocurrency transactions and paying taxes all along.

The big change instead is that certain types of businesses must report certain cryptocurrency transactions that fit specific parameters set by the law, which include digital asset exchanges and cryptocurrency margin trading platforms. Investors and traders who didn’t report their earnings or losses to the IRS in the United States might want to file an amendment on their taxes and get their situation sorted, or else this new law could have the tax man paying them a visit.

Reporting cryptocurrency transactions for tax purposes is daunting in the United States. For example, if you used Bitcoin to buy a cup of coffee, then you could owe taxes on the transaction depending on the price of BTC changed from the time you got it until you spent it. That’s because crypto is treated as property so it is subject to capital gains taxation. When pundits complain that no one uses crypto to pay for anything, that’s the real reason why.

How The Bill Could Hurt Bitcoin Mining And Ethereum Validators

The real valid complaint that the community has against the bill in Washington is the fact that it includes businesses such as miners and validators to report any and all microtransactions. This would lead to an accounting nightmare that would deter any businesses from operating in the country around cryptocurrency mining.

Lobbyists from all over crypto have gathered in Washington in an attempt to gain the ear of politicians who can help make last minute amendments. The amendments have been mostly shut down by adversaries of the asset class, while they also demonstrate a clear lack of understanding about the technology they seek to govern.

The approach many politicians want to take would stifle innovation in the industry, and force developers and projects to seek operations elsewhere. It also could have the opposite effect, further forcing crypto into the darkest corners of the internet, rather than elevating it into mainstream finance.

Even the internet at one point was widely misunderstood and if innovation was stopped, decades of American prosperity in the stock market around major tech firms like Apple, Google, and more never would have existed. If crypto doesn’t follow a similar path and is allowed to flourish, the technology could be doomed.

The Digital Dollar, Digital Yuan, And What Comes Next For Crypto

And what would the reason be for the government wanting to crush cryptocurrencies any way they can? Well, the US government already knows that Bitcoin and other decentralized technologies cannot be stopped, so instead they can impose strict legislation around them to discourage their use and growth.

The lack of regulation has allowed the industry to innovate and grow, but also spin out of control with scams and criminal activity. Some guidelines are clearly needed, but politicians must be careful not to create roadblocks that lead to the demise of the promising technology.

The United States might seek to tarnish the usage of Bitcoin and Ethereum and others to encourage the eventual use and acceptance of a digital USD. China has already created a central bank digital currency of their own, and is pilot testing the so called digital yuan across the region.

China recently took a negative stance against Bitcoin, banning certain transactions and BTC mining outright. It caused a mass exodus to the US from China, but the United States could turn its back on crypto next. The damage done by two major superpowers shunning the technology for their own could have drastic effects.

Breaking Down What The Bill Means For Crypto Markets And Bitcoin Trading

But Bitcoin and other decentralized cryptocurrencies are all about the people, and not the power of the government. So long as these technologies exist, anyone globally will have a financial system they can use to opt out of the traditional financial system controlled by such superpowers. These leaders have always led the world to disaster, and history is soon due to repeat. Bitcoin and other cryptocurrencies are the best hope for change, which is why true patriots in American politics are taking a stance for the technology in Washington.

How the battle resolves could change the future of crypto forever. Speculate on crypto markets with PrimeXBT, an award-winning trading platform with CFDs on forex, Bitcoin, gold, oil, and more all under one roof. Even if the bill doesn’t pass or a last minute amendment changes things, the world of crypto is changing rapidly and volatility is bound to ensue. Be ready for the volatile price action to come.

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