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US Congressmen urge IRS to provide clarity on cryptocurrency taxation laws in new joint letter

Akash Anand



US Congressmen urge IRS to provide clarity on cryptocurrency taxation laws in new joint letter
Source: Pixabay

Government institutions in the United States of America have played a pivotal role in controlling the fate of cryptocurrencies and the digital asset market, in general. One of the main issues that lawmakers and government officials raise is the taxation on cryptocurrencies like Bitcoin [BTC] and Ethereum [ETH], which was discussed again in a recent letter signed by 21 Congressmen to the Internal Revenue Service [IRS].

The letter was written with the intention to clear any ambiguity concerning cryptocurrency taxation as well as informing cryptocurrency holders on how to assess their virtual assets. The congressmen requested the IRS to clarify three major areas that will help in alleviating the confusion surrounding the cryptocurrency industry. These topics included,

“1) Acceptable methods for calculating the cost basis of virtual currencies. Which specific methods does the IRS consider to constitute “a reasonable manner that is consistently applied,” as required by Notice 2014-21?

2) Acceptable methods of cost basis assignment and lot-relief for virtual currencies. Do taxpayers need to use specific identification whenever they spend or exchange virtual currency, or are other methods, such as first-in-first-out or average cost basis, acceptable as well?

3) The treatment of forks for taxpayers that use virtual currencies, such as the 2017 hard fork of the Bitcoin blockchain.”

In the letter, the Congressmen also requested the IRS to respond before May 15, which is exactly a month after the US Tax Day [April 15]. One of the Congressmen who signed the document was Tom Emmer, who introduced three cryptocurrency bills back in September 2018. He had then claimed that the bills were aimed at furthering the development of the burgeoning industry and that it had to be watched over in a controlled fashion. One of the multiple operative clauses in the bill stated,

“The United States should prioritize accelerating the development of blockchain technology to support transparency, security, and authentication in a way that recognizes its benefits and allows consumer protection while supporting future innovation”

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Cardano’s focus is on staying loyal to ecosystem’s scalability & interoperability, says Charles Hoskinson

Arijit Sarkar



Charles Hoskinson shares Cardano's vision to enable scalable and interoperable crypto ecosystem
Source: United States Air Force

As numerous developments continue to change the face of the cryptocurrency space, IOHK’s CEO Charles Hoskinson shared Cardano’s latest innovations in its ecosystem through another one of his AMA sessions. While the entrepreneur expanded on the expected launch of its Haskell and RUST testnets, the AMA was also focused on sharing his aggressive plan to enable Cardano’s smart contracting.

Hoskinson attributed the vision’s ultimate success to three main factors, which include ability to train new developers, the model itself and Cardano’s ability to interface with the broader functional programming community. He supported this idea by saying,

“This is a huge untapped community full of credentialed and qualified programmers. By interfacing our foundation with that community, we should be able to see a lot of really interesting DApps produced for Cardano rather quickly.”

Comparing Cardano’s credibility to the infamous JAVA platform, Hoskinson claims to have made 20 reiterations of the project “because programming language theorists are perfectionists and they really want to get this done right.”

While the Cardano team continues to work towards the deployment of Shelley and Marlowe on the testnet, Hoskinson also hinted at some incremental upgrades that will be expanded upon in the next AMA, as well as on the company’s official website. Out of the many iterations, Cardano’s primary focus will be to stay loyal to the ecosystem’s scalability and interoperability across other crypto-based ecosystems.

Hoskinson also mentioned that his past contributions to Ethereum helped his team explore the design space of the code, which ultimately helped them develop a seamless ecosystem focused on user experience and ease of use. He added,

“People want to keep regulators happy. That said, we will also begin exploring some privacy ideas and how we can also increase privacy on these transactions.”

In addition to backend development, it is also important to note that Cardano’s [ADA] crypto-adoption has allowed it to dethrone Tron [TRX] from the 11th position, with respect to market cap.

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