The US Department of the Treasury has recommended that at least $ 10,000 of the cryptocurrency transfer be reported to the Internal Revenue Service.
Crypto investors saw this as a confirmation that crypto will not disappear.
Biden management has been interested in cryptocurrencies, especially in taxation, in recent months. In a bid to close the tax gap, and amid growing crypto adoption in the US, the administration is trying to take action. This week, it turned out that the US Treasury Department is recommending stricter cryptocurrency compliance with the Internal Revenue Service (IRS).
The Treasury Department said in a statement:
Cryptocurrency poses a major detection problem by facilitating illegal activities in general, including tax evasion.
The ministry added that businesses dealing with cryptocurrencies will also need to report transactions to the IRS.
As with cash transactions, businesses buying crypto assets with a fair market value of more than $ 10,000 will also be reported.
Treasury’s offer includes other resources that will enable the IRS to monitor and address the growth of cryptocurrencies.
The market has seen huge losses, and news from the US government is exacerbating the situation. It disappoints new and existing investors. However, some crypto investors welcomed the news. Regulations in the field are now seen by the government as an acknowledgment that cryptocurrencies are permanent.
Additionally, regulation will ensure that market manipulation is eliminated. Investors can also be sure of cryptocurrencies and the projects they interact with.
Market response to crypto regulation
Market leaders noted that over the past few months, regulations in the industry have been delayed for a long time. In fact, some, including CZ Binance, welcomed the arrangement.
Ripple executives are also demanding better and clearer regulations. The company behind XRP tokens is locked in a legal battle with the SEC over whether XRPs are securities or cryptocurrencies. The lack of clear regulations led to more than 7 years of token trading before the SEC filed the lawsuit.
However, some, such as Cardano’s Charles Hoskinson, warned that the meteoric rise of cryptocurrencies like DOGE could impose strict regulations that could hinder the development of the wider crypto industry.
Although there was a short-term decrease in market prices after the news, the prices followed a stable course after the shaking experienced at the beginning of the week. Bitcoin, in particular, rose to over $ 40,000 at the time of writing. The total market cap is at $ 1.76 trillion and is on its way to over $ 2 trillion, supported by the positive performance of low-value cryptocurrencies.