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IRS Sends Warning Letters to Prevent Crypto Owners from Evading Tax

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The Internal Revenue Service began sending warning letters out to cryptocurrency owners in the United States, announcing that taxpayers should be paying back taxes they owe or to file amended tax returns in regards to their cryptocurrency holdings.

These letters also served as a warning that they may have broken federal tax laws. “Taxpayers should take these letters very seriously by reviewing their tax filings and when appropriate, amend past returns and pay back taxes, interest, and penalties,” said IRS Commissioner Chuck Rettig. The announcement made by the IRS states that the letters are “educational letters” and by the end of August, more than 10,000 taxpayers will have received them.

Cryptocurrency exchange

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Coinbase has shared some of its data with the IRS under a federal–court order on around 13,000 client accounts. These clients were customers who had transacted $20,000 or more between 2013-2015. The data that was provided to the IRS included the client’s name, taxpayer identification number, and address.

Don Fort, the IRS Criminal Investigations Chief mentioned that the IRS plans on making public criminal tax-evasion cases that involve cryptocurrencies. It was also mentioned by the IRS that they will be issuing more legal guidance on cryptocurrencies in the near future.

Images via Shutterstock

American Health Firm Enhances Medical Record Transparency with Blockchain

For the next 3 years, American Health Insurance Company Anthem is reported to be adding blockchain technology to store and share medical history for its 40 million-plus consumer base.

Currently, in the initial stages of testing, Anthem is aiming to offer new features to a select few members to begin the 3-year roll-out plan. Digital Chief and Officer Rajeev Ronanki spoke on behalf of the project, adding, “The system is live for 200 employees, allowing users to scan QR codes available on the Health App to show medical history to healthcare providers for a limited period.”

Direct access to personal medical records and history is a strong movement in the industry, as more and more patients are crying out for improved transparency and efficiency, to allow personal health the best chance of sustainability. Having access to your personal medical history and the ability to share with your physician, can drastically improve time, efficiency and knowledge on previous and future steps to recover.

Data security and reduction in cost, are 2 major elements that can only improve the current systems, even though it will require time to implement.

CEO Gail Boudreaux, attending the Forbes 8th Healthcare Summit in New York, spoke about giving power back to the people, ultimately letting individuals hold all the needed documents to live the best lives they can.

Blockchain and Healthcare continue to grow, globally in the US and in Europe all across the private and public sectors with large investments of time and finances.

Image via Mobiloitte Technologies

American Investors are in Bitcoin Buying Frenzy as BTC Price Rises, Crypto Flows in From Asia

As the Bitcoin bulls continue to run and push the BTC price to new levels, a massive amount of crypto has been shifting from East Asia to North America—a trend which could represent a huge shift in the crypto market according to Reuters.

The Bitcoin price has been soaring this week, hitting an all time high of $19,918 on Dec 2, and now consolidating around the $19,000 level. The BTC price has been largely driven by demand from professional and institutional investors who view the digital asset as a safe haven asset set against a weakening dollar. With the recent headlines of mainstream payment adoption, retail investment in Bitcoin is also rapidly rising.

According to Reuters on Dec 3, it has mainly been North American investors who have been making major gains throughout the Bitcoin 165% price boom. The trend represents a shift in the crypto market which is typically dominated by Asian investment—particularly nations like China, Japan and South Korea.

The report states that, “Weekly net inflows of bitcoin – a proxy for new buyers – to platforms serving mostly North American users have jumped over 7,000 times this year to over 216,000 bitcoin worth $3.4 billion in mid-November.”

Meanwhile, Asian exchanges bled 240,000 bitcoin worth $3.8 billion throughout November, versus an inflow of 1,460 in January, according to the data from blockchain analytics firm Chainalysis.

Reuters also reports that US investors are also being attracted through tightening regulatory overisight on Bitcoin and cryptocurrency. United States exchanges are more highly regulated in general and there has been a continued effort from government authorities, like the Department of Justice (DOJ) and the Office of the Comptroller of the Currency (OCC), to clarify regulatory requirements.

Curtis Ting of Kraken crypto exchange told Reuters:

“You’re increasingly starting to see distinctions in the market between those that have no regulatory or little regulatory clarity, versus those that do.”

However, despite the data indication a move from Asias to American to Bitcoin dominance, industry experts caution it is too early to call a fundamental shift in the market, particularly in regard to the unprecedented year of COVID-19 pandemic-induced market disruption.

Bitcoin’s Rising Acceptance As Store of Wealth

Bitcoin broke through $19,800, reaching a new all-time high before the markets cooled. According to Peter Smith Co-Founder and CEO of Blockchain.com, the crypto markets are seeing a return to 2017 price gains, but this time with more reserved excitement.

Smith put things into perspective for the raised US market sentiment said:

“From 2011 to 2014, bitcoin was a grand experiment. From 2014 to 2017, we realized that it was going to work. From 2017 and onwards, Bitcoin’s become inevitable. Bet on bitcoin’s inevitability.”

Bitcoin has seen a rise in acceptance as a store of wealth and many believe it will take over from gold as the go to safe haven asset. Smith agrees that the gold market makes a fascinating comparison to Bitcoin. But the Blockchain.com CEO predicts that Bitcoin will soon equal at least 10% of the value of the gold market — 20x from where we are today.

Bitcoin billionaires Tyler and Cameron Winklevoss are also predicting similar things for BTC. The Gemini exchange founders told CNBC that the Bitcoin price will surge to $500,000 and replace gold as a store of value with a $9 trillion market cap by 2030.

Tyler Winklevoss said:

“Our thesis is that Bitcoin is gold 2.0, that it will disrupt gold, and if it does that, it has to have a market cap of 9 trillion, so we think it could price one day at $500,000 of Bitcoin.”

According to the billionaire Bitcoin investors, the room for BTC’s price growth makes it a good investment even at its current high levels.

“(BTC) It’s a hold or at least if you don’t have any, it’s a buy opportunity because we think there’s a 25x from here.”

20% of American Adults Involves in the Crypto Space, Study Shows

One of five Americans has used, traded, or invested in cryptocurrency, according to a poll by NBC News.

These statistics show that cryptocurrencies continue to gain steam despite lawmakers warning about the risks involved as they craft measures to regulate the sector.

Out of the 1,000 Americans polled from March 18 to March 22, 20% of them have dabbled in crypto, showing how the industry has soared in recent years despite being relatively young.

Half of the men surveyed between 18 and 49 years acknowledged that they had entered the crypto space, representing the largest share of all demographic groups.

In addition, per the report:

“40% of Black Americans said they have traded or used crypto, while 42% of all people between the ages of 18 and 34 years said the same.”

Crypto advocates have opined that digital assets like Ethereum (ETH), Bitcoin (BTC), and stablecoins render security, privacy, lower costs, better transaction speeds, and give the underbanked financial services.

These are some of the factors that have triggered interest in cryptocurrencies on American soil.

The crypto market in the United States has grown to the extent that President Joe Biden signed an executive order last month, directing relevant authorities to scrutinize the benefits and risks.

This move marked the first step toward regulating how crypto assets are traded.

Crypto adoption continues to gain steam across the globe. According to a recent study by Arcane Research and Ernst & Young (EY), 10% of Norwegian adults own crypto, double the rate recorded in 2018.

Furthermore, a survey by crypto exchange KuCoin revealed that 44% of Germans see crypto as part of the future of finance, Blockchain.News reported.

24% American Households Purchased NFTs or Crypto, Study Shows

Cryptocurrencies and non-fungible tokens (NFTs) are emerging as some of the sought-after assets by households and sports fans on American soil, according to a poll by the Seton Hall University.

Per the report:

“While the concepts of cryptocurrency and NFT may still be foreign to many Americans, 24 percent of households in the U.S. have owned either or both.”

The demographics were even higher for avid sports fans at 57%, whereas the rest of the sports fans acknowledged owning these financial assets at 34%. The poll added:

“When asked specifically if their holdings were cryptocurrency and/or NFTs, survey participants indicated stronger engagement with crypto. Of those who hold and/or sold either, 62 percent specified crypto only, while 31 percent specified NFTs only. Seven percent said both.”

Those aged 18 to 34 years had a higher participation rate in crypto and NFT trading at 42%.

NFTs can become a game-changer in the sporting arena as an ideal source of revenue, according to Seton Hall Marketing Professor and Poll Methodologist Daniel Ladik.

He pointed out:

“If managed effectively, NFTs could become a major source of revenue as well as a new avenue of fan connection for sports brands. In a digital age, interactive assets like NFTs can drive a sense of holder equity and belonging – key attributes for brand success.”

The poll noted that sports fans got inclined toward NFTs based on some of the benefits accrued, like getting discounts when a team scored and upgrading a ticket.

Charles Grantham, the Director of the Center for Sport Management at Seton Hall’s Stillman School of Business, acknowledged:

“The numbers would seem to indicate that NFTs represent fertile ground for leagues to enhance the fan experience.”

Nevertheless, Grantham commented that more had to be done in the NFT space and said:

“But, perhaps because teams and leagues don’t fully understand the nature and potential of NFTs and perks like a digital VIP card, that ground has yet to be sown effectively by major sports organizations in the United States.”

Americans have shown their interest in the crypto space based on past research. For instance, Americans presented a stronger desire than Canadians for cryptocurrencies, according to a recent Ipsos survey.

Furthermore, a FitRated study showed that 81% of Americans would be motivated to exercise if they got crypto rewards, Blockchain.News reported.

69 % Female Crypto Investors in U.S. Adopt Holding Strategy, Survey Shows

Female Americans continue to be resilient as cryptocurrency owners, despite the broad market turmoil being experienced, according to a survey by global crypto financial services company BlockFi.

Through the latest edition of the Real Talk survey, BlockFi suggested that female crypto investors on American soil had a long-term outlook because they had adopted the buy-and-hold strategy. Per the report:

“When asked specifically what best describes their crypto investment style, the majority of female crypto owners (69%) said they hold crypto and remain hold-only.”

Flori Marquez, BlockFi’s founder and COO, added:

“The crypto landscape and the number of players look completely different than it did six months ago when we last issued this survey and yet the faith in the crypto markets and its potential as a long-term investment strategy remains. This resiliency is extremely promising.”

On the other hand, interest in this asset class has also not significantly decreased among female Americans. BlockFi noted:

“More than one in five women (22%) still intend to buy crypto in the next 12 months, down slightly from 28% the year prior.”

Some of the reasons why female investors in America are attracted to cryptocurrencies is because they believe it’s an inflationary hedge. Per the survey:

“When asked, one in five women believe crypto to be a good hedge against inflation. Even more, 20% of Gen Z women noted Bitcoin as the best long-term investment when presented with a list of options including individual stocks and real estate.”

Nevertheless, the study revealed a generational gap because one in ten women on American soil chose crypto as their first investment.

Meanwhile, an Ipsos survey showed that the intention of investing in cryptocurrencies or using them as a payment option was higher among Americans compared to Canadians, Blockchain.News reported.