Russia has integrated the use of digital assets as payment for international transactions in its legislation. President Vladimir Putin signed into law a document that describes using these assets as payment for international settlements, a use case not contemplated in any law, appointing the Central Bank of Russia as the overseer of these transactions. Russia […]
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The Biden administration released its proposed budget for 2025 on March 11, which includes provisions to implement a series of regulatory measures targeting digital assets.
The proposed rules are expected to generate nearly $10 billion in additional tax revenue by 2025.
The new budget proposals specifically target a loophole that has previously allowed wealthy crypto investors to benefit disproportionately. By closing this gap, the administration seeks to create a more level playing field for all investors and increase tax fairness. The measure is part of a broader effort to adapt the nation’s tax code to the modern era of investment and technology.
Moreover, the proposals include a comprehensive approach to digital assets by applying wash sale rules to these assets, addressing related party transactions, and modernizing regulations to treat securities loans as tax-free to include other asset classes. These steps are designed to update the tax system to reflect the unique characteristics and challenges of digital asset transactions.
Furthermore, the budget emphasizes enhancing reporting requirements for financial institutions and digital asset brokers. This adjustment aims to ensure that transactions involving cryptocurrencies are monitored with the same diligence as traditional financial exchanges, thereby increasing transparency and reducing opportunities for tax evasion.
The government also plans to require certain taxpayers to report foreign digital asset accounts, extending the reach of US tax compliance efforts internationally.
According to the document, applying wash sale rules to digital assets is projected to raise over $1 billion in tax revenue in the fiscal year 2025 alone.
The budget also states that including digital assets in mark-to-market rules — which mandate the taxation of securities at their current market value rather than their purchase price — is expected to generate an additional $8 billion by the same year.
The proposal also introduces an excise tax on crypto mining operations, reflecting the sector’s rapid growth and relatively minor fiscal contributions, especially considering its environmental footprint.
The proposed excise tax on crypto mining endeavors is forecasted to decrease the national deficit by approximately $7 billion within the same timeframe. While similar tax provisions were proposed in last year’s budget, they faced legislative hurdles and were not enacted by Congress.
Aside from those crypto-related proposals, Biden’s budget broadly advances reduced costs for families, more robust Social Security and Medicare, and higher taxes on corporations and wealthy individuals.
According to CBS, the budget could trim deficits by $3 trillion over a decade while raising tax revenues by $4.9 trillion and allocating roughly $1.9 trillion to various programs.
In an email found within the motion by Digital Currency Group (DCG) and Barry Silbert to dismiss the lawsuit initiated by the New York Attorney General, discussions of a potential merger between Gemini and Genesis were revealed before Genesis ultimately opted to declare bankruptcy. “Combined Gemini and Genesis would be a juggernaut and would be […]
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Elvira Nabiullina, Governor of the Bank of Russia, stated that the current pilot test of the Russian digital ruble was “on track,” with several operations being tested, including opening wallets, and interactions with smart contracts. Nabiullina revealed that over 25,000 transactions were registered, and confirmed the pilot expansion later this year. Russian Digital Ruble Pilot […]
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Galaxy Digital CEO Mike Novogratz sees “a tremendous global demand for bitcoin,” emphasizing: “This is probably the first time in the history of bitcoin that we have true price discovery.” Noting that there is “a new army of buyers” and there is also “an army of salespeople,” he expects the price of bitcoin to be […]
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The European Central Bank (ECB) has published a blog post claiming that “bitcoin has failed to fulfill its original promise to become a global decentralized digital currency.” The ECB economists who authored the post added that bitcoin’s fair value is still zero and bitcoin transactions are “still inconvenient, slow, and costly.” Moreover, they asserted that […]
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Lejilex and the Crypto Freedom Alliance of Texas, a crypto nonprofit, have teamed up to introduce a complaint against the actions of the SEC towards actors in the digital asset industry in America. The complaint alleges that the SEC has no regulatory powers over these crypto companies, having usurped functions not given to it by […]
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The digital yuan, China’s central bank digital currency (CBDC), is being used as a security element in car prepurchase payment settlements. According to local media reports, a pilot test that allows customers to pay for their cars with digital yuan was established in early February in Shenzhen, and several customers are already purchasing their vehicles […]
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South Africa announced plans to weave digital payments and crypto into its financial fabric to boost the economy for marginalized groups.
The announcement was made in the country’s 2024 budget and underlines the government’s drive to build a digital economy through active collaborations between public and private sectors to enhance financial innovation.
The budget targets enhancing access to digital payments for people in townships and rural areas who predominantly handle cash. Initiatives will provide local merchants with the infrastructure needed for digital transactions, like internet connectivity and point-of-sale systems.
Starting with a pilot in Gauteng, these efforts seek to broaden the acceptance and use of digital payments among both consumers and businesses.
South Africa intends to legitimize crypto payments and make them an intrinsic part of the local economy over the coming years, starting with a regulatory framework for the sector. The country made crypto an official financial product in 2022, akin to company shares or debt.
The Intergovernmental Fintech Working Group (IFWG) will start issuing comprehensive guidelines in 2024 that will focus on “stablecoins” and their practical applications. This effort will complete a thorough review of the stablecoin environment domestically and create regulatory recommendations that align with global standards.
In 2023, the Financial Sector Conduct Authority (FSCA) and the Financial Intelligence Centre (FIC) started to register crypto asset service providers, following changes to the FIC Act that align with FATF recommendations. The FSCA’s classification of crypto as a financial product now requires service providers to obtain a license, ensuring they meet strict operational standards.
The government is reviewing the extension of the FIC Act’s mandate, which currently requires reporting cash transactions over R49,999, to include crypto transactions. The move aims to use such data in fighting crime.
Additionally, the government intends to explore tokenization and how blockchain technology can represent assets, with the publication of policy and regulatory implications planned for December 2024.
The South African central bank has been considering the development of a central bank digital currency (CBDC) for a number of years. However, the regulator has yet to announce any significant progress in the area.
The National Treasury and the Reserve Bank, together with international partners, are rolling out four pilot projects focused on digital payments to aid small and informal businesses.
These projects aim to digitize community transactions, informal worker payments, and cross-border remittances to facilitate finance for small traders engaging in cross-border commerce. Each initiative addresses specific hurdles, from cutting remittance costs to implementing digital tipping for low-income workers.
These efforts highlight South Africa’s determination to be at the forefront of financial digitalization and inclusion, using technology to strengthen its economy and uplift its people. By integrating crypto and emphasizing a solid regulatory framework, the country shows a progressive approach that ensures innovation goes hand in hand with consumer protection and financial integrity.
In a recent meeting with the European Parliament’s Committee on Economic and Monetary Affairs, Piero Cipollone, a member of the ECB Executive Board, discussed the forthcoming digital euro, specifically its privacy features, infrastructure procurement, and operational standards.
Cipollone’s presentation emphasized the ECB’s proactive approach to collaborating with EU-based entities for the digital currency’s infrastructure. He added that all these entities are registered within the EU and controlled by an EU national.
Privacy considerations were a key focus of Cipollone’s remarks. He assured the Parliament that the digital euro would feature superior privacy protections compared to existing commercial payment solutions and include anonymous offline payment transactions.
The ECB executive detailed the planned privacy features of the digital euro, stating that it would collect only a minimal set of pseudonymized data necessary for operations such as settlement. This approach is intended to enhance online payment privacy, addressing public concerns over data protection in digital transactions.
For online transactions, the ECB would access only a necessary, pseudonymized data set for operational purposes like settlement, promising users greater data control than current private payment systems offer.
Moreover, according to Cipollone, the digital euro is designed with top-tier cybersecurity measures to safeguard user data and transactions.
Cipollone said the digital euro has been designed to mirror the accessibility and reliability of cash, thereby reducing reliance on global payment processors and ensuring uniform service across the eurozone. He added:
“Cash and a digital euro have the same objective: ensuring that everyone, regardless of their income, can pay in any situation of daily life. This is a fundamental right. And it should be protected in the same way in all parts of the euro area.”
He likened the digital euro’s infrastructure to public railways, suggesting it would be state-owned yet accessible to various private operators.
Cipollone also touched on the importance of a digital euro rulebook to ensure consistent implementation across the eurozone, aiming to reduce dependency on international payment processors by providing a uniform set of rules, standards, and procedures.
Addressing financial stability, the ECB executive outlined measures to prevent the digital euro from competing with traditional savings accounts, including interest-free holdings and restrictions on the digital euro’s accumulation by corporations and financial institutions.
He also mentioned plans to facilitate seamless transactions by linking CBDC wallets with bank accounts, circumventing the need for wallet pre-funding.
The dialogue between the ECB and the European Parliament is part of the preparatory phase for the digital euro, with the ECB providing technical input to co-legislators. The ECB’s efforts aim to prepare for a potential digital euro launch within a framework that prioritizes privacy, operational readiness, and financial stability.