Indian Tax authorities investigating ways to collect tax from bitcoin exchanges
India’s central tax authority is investigating bitcoin exchanges to try and find a way to tax transactions, an official said on Wednesday, even as the Reserve Bank of India (RBI) has warned against dealing in virtual currencies.
Thousands of transactions are taking place every day in unregulated cryptocurrency exchanges and the Income Tax Department has launched surveys in the cities of Delhi, Mumbai, Pune, Bengaluru and Hyderabad, spokeswoman Surbhi Ahluwalia said.
“We are looking at collecting information about modus-operandi of bitcoin exchanges, investors, their source of investment and possibility of collecting tax,” Ahluwalia told Reuters.
Last week, the RBI said it was concerned about bitcoin, just days after the cryptocurrency hit a record high of just under $11,800, stocking fears that a rapidly swelling bubble could burst.
The RBI had previously said those trading in virtual currencies were doing so at their own risk, given that the central bank had not given a licence or authorisation for any company to deal in such cryptocurrencies.
The tax official declined to comment on the central bank’s concerns, saying the tax department was looking only into the tax implications. The government has set up a panel to decide on India’s stand on cryptocurrency.
This year, the government told parliament that the use of virtual currencies like bitcoin was not authorised by the RBI and could result in breach of anti-money laundering laws. Bitcoin hit another all-time peak on Tuesday, two days after the launch of the first ever bitcoin futures on a U.S. exchange as investors grew optimistic that the $20,000-mark is within reach.
Written by First Post
Are Bitcoin Salaries the Future? This Japanese Internet Company Thinks So
A Japanese internet company with the bitcoin bug will soon allow its employees to receive some of their salaries in the form of cryptocurrency.
Tokyo-based GMO Internet Group announced the new payment option will launch in February 2018, according to digital currency news site coindesk.com. GMO said the option will gradually be opened to all of its more than 4,000 full-time employees.
Those opting in to the new scheme will be able select what portion of their monthly salary to receive in bitcoin between a minimum of 10,000 yen (around $88) and a maximum of 100,000 yen ($882), according to coindesk.
GMO is even reportedly offering an incentive for those who join the new payroll system—a bonus of 10 percent of the selected bitcoin amount.
While Japanese labor laws stipulate paying salaries in yen, GMO told Kyodo News that it was not breaking any regulations since the bitcoin payment would be optional, based on mutual agreement and deducted from an employee’s monthly paycheck.
The tech company, which registers domain names and offers web hosting and other services, joined the bitcoin spree this past May with the opening of an exchange, GMO-Z.com Coin, which was later rebranded as GMO Coin. In September, GMO announced it would invest $3 million in mining bitcoin — the process of obtaining the coin through powerful computers — starting in the first half of 2018.
The firm says it believes cryptocurrencies like bitcoin will evolve into “universal currencies” available to anyone globally, leading to a “new borderless economic zone.”
Written by Fortune
Bitcoin latest: Third of millennials will be invested in the cryptocurrency in 2018
ne in three millennials will be invested in a cryptocurrency by the end of next year, possibly enticed by the meteoric rise in the value of bitcoin over recent months, according to new research.
The study by cryptocurrency exchange London Block Exchange reveals that five per cent of those aged below 35 already have cash invested in a cryptocurrecy, while 11 per cent are definitely planning to invest next year, shunning more traditional investments such as shares, bonds and property.
A further 17 per cent are seriously considering investing in a digital currency by the end of 2018, the study found.
LBX said that millenials are turning to cryptocurrencies because they feel left behind by more traditional investments – particularly property and pensions.
“This study underlines the gulf between the younger generation’s view of money and that of their parents and grandparents, who had assets perform so well for them in pensions or property,” said LBX Founder and chief executive officer Benjamin Dives.
“Millennials clearly feel left behind by the old system and are looking at cryptocurrencies as a new dawn,” he added.
If this happens it would make digital currencies – including bitcoin, ethereum and litecoin – a more popular asset among millennials than shares, bonds, precious metals or a second property.
The LBX research predicts that 12 per cent of millennials will be invested in shares, 20 per cent in bonds, 19 per cent in precious metals and 18 per cent in property by the end of next year.
A total 24 per cent of those aged under 35 said that they regret not buying into a crypotocurrency earlier after seeing bitcoin’s value soar over the past year.
The poll of 2,000 Britons, across a broad demographic, also found that the North East of England – with its growing tech scene – is second only to London when measured by the number of people across all age ranges who are interested in cryptocurrencies. People living in the South East of England, Wales and East Anglia are among the least interested.
And it also shows that the soaring value of bitcoin has not caught the interest of older generations. Some 57 per cent of those aged over 55 say that they definitely won’t be buying digital currencies.
Garrick Hileman, cryptocurrency expert and research fellow at the University of Cambridge, said that while banks and other financial institutions have been struggling to find ways to connect with millenials, cryptocurrencies in a very short period of time have overcome the initial stigma surrounding their use with young people.
“Millennials began their income generating years during the fallout from the 2008 financial crisis, and many don’t completely trust traditional financial services firms or the system in which they operate,” he said.
While Bitcoin has appreciated significantly in price this year – soaring past $17,000 (£12,718) on 8 December – it has also exhibited substantial volatility.
Written by Independent
South Korea considers cryptocurrency tax as regulators grapple with ‘speculative mania’
SEOUL (Reuters) – South Korea said on Wednesday it may tax capital gains from cryptocurrency trading as global regulators worried about a bubble, with Australia’s central bank chief warning of a ‘speculative mania” that has seen the digital asset making rip-roaring gains.
As bitcoin futures made their world debut on a U.S. stock exchange this week, policy makers have been forced to contend with cryptocurrencies becoming more of a mainstream play and the need to regulate them.
The world’s biggest and best known cryptocurrency, bitcoin BTC=BTSP, surged past $17,000 to new all-time highs this week, marking an almost dizzying 20-fold rise this year and feeding fears of a bubble.
Australia’s central bank governor Philip Lowe warned on Wednesday the fascination with the assets felt like a “speculative mania.”
The comments come days after his New Zealand counterpart said bitcoin appeared to be a “classic case” of a bubble, and cast doubt on its future. The chairman of the U.S. Securities and Exchange Commission (SEC) on Monday warned trading and public offerings in the emerging asset class may be in violation of federal securities law.
Digital currencies are very popular across Asia, with many retail investors giving up their daily jobs to trade them full time in countries such as Japan and South Korea, which together make up for more than half the global trading volumes by some estimates.
But the possibility of major losses if the bubble bursts and wild gyrations of 10-30 percent in a single day have instilled a sense of urgency among policymakers to come up with a regulatory response.
In Seoul, after an emergency meeting on Wednesday, South Korea’s government said it will consider taxing capital gains from trading of virtual coins and will also ban minors from opening accounts on exchanges, according to a statement obtained by Reuters ahead of its official release.
To be eligible, exchanges in South Korea will need to uphold investor protection rules and disclose all bid and offer quotes.
The measures need parliamentary approval. Seoul will maintain a current ban on all financial institutions dealing virtual currencies.
“The regulations in Korea will not have a negative effect,” said Thomas Glucksmann, head of marketing at Hong Kong-based exchange Gatecoin, adding that on the contrary, “licensing brings certainty, which encourages already regulated entities … to get involved in addition to skeptical retail investors.”
In an interview with Reuters on Tuesday, the Seoul-based operator of the world’s busiest virtual currency exchange Bithumb, said it will fully comply with potential regulations from the South Korean government and adequately capitalize itself to protect its clients.
Elsewhere in Asia, China in September ordered Beijing-based cryptocurrency exchanges to stop trading and immediately notify users of their closure, in a move aimed at limiting risks in the speculative market. Economists and cryptocurrency advocates say the move was also intended to close an avenue used to evade Beijing’s capital controls.
Japan requires crypto-currency operators to register with the government. The Japanese government in April granted cryptocurrencies legal status as a means of settlement and in September officially recognized 11 digital currencies exchanges.
CRYPTO COINS WEAKEN
Bitcoin dropped to $16,575 on Wednesday, down 0.5 percent on the day, after losing $152 from its previous close. On Bithumb, it was down 2 percent at $17,083. Bitcoin futures maturing in January on the Cboe Global Markets Inc’s Cboe Futures Exchange XBTF8 were $17,700, having opened at $18,010.
Bitcoin-related shares in Seoul slumped in early trade on news of the government’s emergency meeting, before rebounding as the statement did not mention harsh restrictions. Vidente Co Ltd (121800.KQ) and Omnitel Inc (057680.KQ), which hold stakes of Bithumb, were up 4 percent and 7 percent, respectively. Bitcoin mining-related company JCH Systems Inc (033320.KQ) were up 1 percent.
While crypto trading has attracted anyone from hedge funds and finance professionals to housewives and college students, it is yet to lure institutional asset managers whose mandates require them to make long-term investments which do not chime with highly-volatile digital currencies, whose fundamental values are also difficult to define.
“BlackRock’s view is that this isn’t a financial asset that we would trade in terms of equities or fixed income instruments,” said Belinda Boa, head of active investments for Asia Pacific, BlackRock.
“There are questions around the store of value and the fact that actually for our clients we’re looking at longer term investments.”