Category Archives: Cryptocurrency
Cryptocurrency scams: What to know and how to protect yourself – We Live Security
As you attempt to strike it rich in the digital gold rush, make sure you know how to recognize various schemes that want to part you from your digital coins
The world seems to have gone crypto-mad. Digital currencies like bitcoin, Monero, Ethereum and Dogecoin are all over the internet. Their soaring value promises big wins for investors (before the coins prices plunge, that is). And the fortunes to be made by mining for virtual money have echoes of gold rushes in the 1800s. Or at least, thats what many, including a long list of scammers, will have you believe.
In reality, if youre interested in cryptocurrency today, youre quite possibly at a major risk for fraud. This is the new Wild West a lawless, unregulated world where bad actors often have the upper hand. But normal rules for fraud prevention apply here too. Everything you read online should be carefully scrutinized and fact-checked. Dont believe the hype and youll stand a great chance of staying safe.
Fraudsters are past masters at using current events and buzzy trends to trick their victims. And they dont come much more zeitgeist-y than cryptocurrency. Media stories and social media posts are partly to blame, creating a feedback loop that only adds to the hysteria over virtual currencies. The result? Between October 2020 and May 2021, Americans lost an estimated $80m (71m) to thousands of cryptocurrency scams, according to the FTC. In the UK, the figure is even higher: police claim that victims lost over 146m (172m) in the first nine months of 2021.
Why are scams on the rise? Because:
If you have virtual money safely stored in a cryptocurrency exchange, it may be at risk from hackers. On numerous occasions threat actors have successfully managed to extract funds from these businesses, sometimes making off with hundreds of millions. However, usually the breached companies will promise to recompense their blameless customers. Unfortunately, there are no such assurances for the victims of cryptocurrency fraud. Fall for a scam and you may be out-of-pocket for a lot of money.
It pays to understand what these scams look like. Here are some of the most common:
This is a type of investment scam where victims are tricked into investing in a non-existent company or a get rich quick scheme, which in fact is doing nothing but lining the pocket of the fraudster. Cryptocurrency is ideal for this as fraudsters are always inventing new, unspecified cutting edge technology to attract investors and generate larger virtual profits. Falsifying the data is easy when the currency is virtual anyway.
Scammers encourage investors to buy shares in little-known cryptocurrency companies, based on false information. The share price subsequently rises and the fraudster sells their own shares, making a tidy profit and leaving the victim with worthless stocks.
Scammers hijack celebrity social media accounts or create fake ones, and encourage followers to invest in fake schemes like the ones above. In one ploy, some $2m was lost to scammers who even name-dropped Elon Musk into a Bitcoin address in order to make the ruse more trustworthy.
Fraudsters send emails or post social media messages promising access to virtual cash stored in cryptocurrency exchanges. The only catch is the user must usually pay a small fee first. The exchange doesnt exist and their money is lost forever.
Cybercriminals spoof legitimate cryptocurrency apps and upload them to app stores. If you install one it could steal your personal and financial details or implant malware on your device. Others may trick users into paying for non-existent services, or try to steal logins for your cryptocurrency wallet.
Sometimes the scammers even manage to fool journalists, who republish fake information. This happened on two occasions when legitimate news sites wrote stories about big-name retailers preparing to accept certain cryptocurrencies. The fake press releases that these stories were based on were part of pump-and-dump schemes designed to make the fraudsters shares in the mentioned currencies more valuable.
Phishing is one of the most popular ways fraudsters operate. Emails, texts and social media messages are spoofed to appear as if sent from a legitimate, trusted source. Sometimes that source for example, a credit card provider, bank or government officialrequests payment for something in cryptocurrency. Theyll try to hurry you into acting without thinking.
The best weapon to fight fraud is incredulity. Unfortunately, we live in an age when not everything we read online is true. And quite a lot of it is explicitly crafted to trick and harm us. With that in mind, try the following to avoid getting scammed:
The world may have gone cryptocurrency-crazy. But you dont need to join in. Keep a cool head and ride out the hype.
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Cryptocurrency scams: What to know and how to protect yourself - We Live Security
Best Cryptocurrency to Invest in 2022 for Long-term Investments – Marca English
Cryptocurrency continues its global rise to prominence, with growing numbers of investors viewing it as a worthwhile part of their portfolios.
After the failure of ICO's (Initial cryptocurrency offerings) in 2017 and 2018 which spooked early adopters, there has been an upturn in momentum in recent times through two new instruments - NFTs and DeFi.
And as we look ahead to 2022, there are a variety of products that may harvest a good return.
Bitcoin is possibly the best-known cryptocurrency, and is now into its 13th year having launched in 2009.
It is the world's largest cryptocurrency by market capitalisation, and it is traded using software based on blockchain technology, a decentralized database that runs on more than 15,000 computers (nodes) around the world and records transactions and account balances.
That durability and time-tested status ensures Bitcoin should continue to be a popular hold in 2022.
Historically just behind Bitcoin in the cryptocurrency stakes, 2022 could be the year that Ethereum starts a rise to the top.
It dominates financial transactions and payments across all sectors, as well as providing the infrastructure for much of the DeFi protocols, and as such has an actual function as well as simply holding value.
It accounts for around 20 percent of the overall market.
In terms of 'altcoins', Solana which recently fell 12%, presents itself as the best option for investment as it seeks to establish a new smart contract network to compete with Ethereum.
Launched in 2020 it is still relatively new, however it is already starting to acquire an increasing share of the market.
Polkadot is very similar to Ethereum in allowing developers to create smart contracts and applications. From a functionality standpoint, it may grow a lot over the next year.
The cryptocurrency of the world's largest exchange can have a great growth during 2022, as long as it is easier and cheaper to transact with Binance crypto, there will be more movement in the market, which would influence the trading price.
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Best Cryptocurrency to Invest in 2022 for Long-term Investments - Marca English
IC15, India’s First Cryptocurrency Index: Key Things To Know – NDTV Profit
IC15 will monitor the performance of the 15 most-traded crypto coins in the world.
As India is witnessing a booming crypto industry, several players are showing interest in investing and offering services for investors in the country. In that effort, cryptocurrency app CryptoWire has launched a dedicated index for Indian investors. Named IC15, the first such index in the country will monitor the performance of the 15 most-traded crypto coins in the world. The company says it intends to create awareness about crypto and its underlying blockchain technology among investors. The launch has come at a time when there are some efforts from authorities to set rules to regulate the new industry as it unfolds.
The crypto bill, called the Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, was expected to get Parliament's approval this winter session but it could not be done. The Reserve Bank of India (RBI), which is not excited about the private crypto coins, has said it is working to launch its own cryptocurrency.
Here are the key things that you should know about the IC15 index:
* CryptoWire, the Mumbai-headquartered company behind IC15, is a unit of crypto statistics provider TickerPlant. The index enables crypto enthusiasts and investors to monitor the performance of cryptocurrencies in global markets.
* The index will monitor the top 15 crypto coins listed on major exchanges around the world. These coins are - Bitcoin, Ethereum, XRP, Bitcoin Cash, Cardano, Litecoin, Binance Coin, Chainlink, Polkadot, Uniswap, Dogecoin, Solana, Terra, Avalanche, and Shiba Inu.
* A governance committee will oversee the functioning of the index. This committee will have domain experts, industry practitioners and academicians. They will administer and rebalance the index every quarter.
* The company says the index has been designed to offer insights into crypto mining and help investors make informed decisions to mitigate risks.
* For a crypto coin to be listed on IC15, it needs to trade on at least 90 per cent of the trading days during the review period. Its market capitalisation during the preceding month should also remain in the top 50.
* The base value is set at 10,000 and April 1, 2018, is the base date.
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IC15, India's First Cryptocurrency Index: Key Things To Know - NDTV Profit
One company is offering dividends in bitcoinbut experts say it may be better to just buy the cryptocurrency directly – CNBC
BTCS Inc., a blockchain infrastructure and technology company, announced on Wednesday that it will offer the "first-ever dividend payable in bitcoin by a Nasdaq-listed company."
Dubbed the "Bividend" by BTCS, the company said it will pay a dividend of five cents per share in bitcoin to its investors based on the price of bitcoin on the ex-dividend date of March 16.Shareholders would be paid on March 17. If preferred, they have the option to receive the dividend in cash instead.
Following the announcement, shares of BTCS jumped on Wednesday. The stock was up nearly 44% by close.
However, financial experts warn not to buy a stock based on the hype surrounding it or its dividend.
"If you want to own that company, then own that company," Ivory Johnson, certified financial planner, chartered financial consultant and founder of Delancey Wealth Management, tells CNBC Make It. "But if you want to buy bitcoin, then buy bitcoin. Don't buy this to get bitcoin."
When buying any stock, your decision should be based on the fundamentals of the company itself, he says.
Though Douglas Boneparth, certified financial planner and president of Bone Fide Wealth, thinks the bitcoin dividend is "cool," he agrees with Johnson that it isn't a reason to buy the stock.
"Learn more because you're primarily investing in the company and its future cash flows," Boneparth, who has invested in bitcoin since 2014, tellsCNBC Make It.
Though he thinks the "Bividend" is a "really neat bridge" to direct ownership of bitcoin, "jumping in there just because this is happening is jumping in on a feature, not necessarily the product," he says. "You'd still approach this as you would any other any investment."
If shareholders decide to opt into the "Bividend," they'd be responsible for providing their own bitcoin wallet and securing that wallet, which isn't an easy feat.
In addition, shareholders would need to complete a few more steps, including filling out a form with the U.S. Securities and Exchange Commission (SEC), which would require disclosure of their name, Social Security number and bitcoin wallet address.
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One company is offering dividends in bitcoinbut experts say it may be better to just buy the cryptocurrency directly - CNBC
Cryptocurrency Shiba Inu plans to reduce gas fees, aims to launch its own blockchain – The Indian Express
Cryptocurrency Shiba Inu (SHIB) that started off as a meme is not a joke anymore. Inspired by a dog meme and posed as Dogecoin killer, SHIBs value skyrocketed in 2021 but it seems SHIB developers want to drop the memecoin tag with the launch of its own Blockchain called Shibarium.
Shibarium is expected to provide SHIB users with new functionalities such as reduced gas fees. The gas fee is paid to process and validate transactions in a crypto ecosystem and has become a huge problem for the blockchain.
Creators of Shiba Inu want to launch their own stable coin on the blockchain called SHI that runs its gas fees on the site. This could actually improve the networks performance as well as establish SHIB as an important digital coin. There is no exact date for the launch of the new development.
Shiba Inus founder Ryoshi on Medium wrote, I have already spoken to a very competent blockchain team who has volunteered to build and fully decentralize this for the Shiba ecosystem.
It should be noted that currently, Shiba Inu functions on the Ethereum blockchain and with the growing demand of Shiba Inu, its developers fear that people would stop trading in the coin. Right now every transaction on Ethereum costs over $9.1 and Shibarium aims to bring this down to as low as possible.
Meanwhile, SHIB was the most viewed crypto in 2021, beating the likes of Bitcoin and even Ethereum, announced cryptocurrency price-tracking website CoinMarketCap.
According to CoinMarketCap, the Dogecoin spinoff recorded more than 188 million views during the last 12 months, while apex cryptocurrency Bitcoin came in second with 145 million views in 2021. It should be noted that SHIB is currently the 13th largest cryptocurrency in the world, with a market cap of over $20 billion.
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Cryptocurrency Shiba Inu plans to reduce gas fees, aims to launch its own blockchain - The Indian Express
The number 3 cryptocurrency, with 1,300% rally this year, outshines rivals Bitcoin and Ether – Mint
Bitcoin and Ether's rival, which is the three largest cryptocurrency by market capitalization, Binance Coin (BNB) has significantly outperformed the two most popular digital tokens. Binance coin has skyrocketed nearly 1,300% this year (year-to-date).
BNB is used widely on Binance, the worlds biggest crypto exchange by volume. It is also the native currency of Binance Smart Chain, a blockchain platform that supports smart contracts for use in decentralized finance (DeFi) and other applications.
Meanwhile, Bitcoin is up 62% in 2021 whereas the second largest cryptocurrency, Ether has surged more than 400% during the said period. Tuesday. Bitcoin, famed for its volatility, has shed more than $21,000 since hitting a record in early November.
On the other hand, Ether, the token of the Ethereum network, has outperformed Bitcoin from the adoption of blockchain technology by financial technology companies, and perhaps more notably the popularity of non-fungible tokens (NFTs) in the art and gaming worlds.
As a blockbuster year for cryptocurrencies ticks to a close, other alternative coins, or altcoins, also saw major gains in 2021. Many coins other than the largest few have posted spectacular runs this year. Coins such as Dogecoin, Cardano and Shiba Inu, previously relegated to the most speculative corners of the market, have turned into household names this year. Solana and Fantom, coins connected with other blockchain platforms that support smart contracts, outpaced Binance Coins returns, for instance.
Cryptocurrency prices went on another roller coaster this past year, surging, plunging and then cycling again. El Salvador became the first country to make Bitcoin legal tender this year whereas the first exchange-traded fund tied to Bitcoin futures also began to trade.
(With inputs from Bloomberg)
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The number 3 cryptocurrency, with 1,300% rally this year, outshines rivals Bitcoin and Ether - Mint
The Power of Social Influence on Cryptocurrency HUH Token Set to be the Next Shiba Inu – Techpoint Africa
This article is a Brand Presspost.Brand Pressis a paid service for brands that want to reach Techpoint Africas audience directly. Techpoint Africas editorial team doesnt write Brand Press content. To promote your brand via Brand Press, please emailbusiness@techpoint.africa
Content producers and influencers are looking for new methods to monetise their intellectual property, image, and likeness, and blockchain and cryptocurrency are becoming more important. The adoption of this new technology is causing a fundamental change in how money moves through the ecosystem of the entertainment business.
The Difference Between Influencers and Content Creator
We often use these phrases interchangeably, yet there is a significant distinction. An Influencer is a broad phrase that encompasses someone with a huge following. Professional sportsmen and actresses are often influencers who create an impact with their public personalities but do not always do so by providing content.
There are content producers who are influencers, but not all content creators are influencers. Many social media superstars have risen to popularity on sites such as TikTok, YouTube, and Twitch, but there are many more producers out there who havent yet made it big.
HUH Token (HUH)
One cryptocurrency that understands the importance of social influence is HUH, which was recently launched in early December 2022. This cryptocurrency is a self-described utimeme as it takes both the propagational power of a meme with the functional utility.
It is currently available on Pancakeswap, but it has also gone multi-chain and was released on Uniswap, Ethereums exchange network, on the 6th of January. There are apparently more listings happening being announced at the end of this week. In regards to this cryptocurrencies meme potential, it has been announced that hundreds of well known, viral, Instagram and Twitter influencers will be posting about HUH towards the end of this month.
This, combined with their referral mechanism, has the capacity to propel it into a Shiba Inu frenzy. The token launched to a 6000% increase without their army of influencers. This coming demonstration is only a taste of what is to come, the marketing campaign is incredibly strong for this cryptocurrency, and its well understood the value that attention has in the cryptosphere.
Blockchain Content
When it comes to utilising content on the blockchain, its recommended that producers begin with NFTs. Fans and creators/influencers have several options to interact in novel ways. NFTs use the same blockchain software as cryptocurrencies, but instead of holding financial assets, they represent intellectual property ownership. HUH Token is also utilising this strategy too. They will be airdropping NFTs at the end of this month to their presale participants.
Personalised creator tokens are a lesser-known use of cryptocurrency. These may be one-of-a-kind community-building materials; think of them as elite-level membership passes. Ownership of these assets offers greater access to the creator, enabling both artists and fans to trade enormous value in a fast and secure manner. Its a new source of money for creators. It might be a chance for fans to engage with artists on a deeper level. HUH Token also plans to create a platform for this type of monetisation, integrating itself as a platform and participating in the Metaverse. Their plans for a Met-HUH-Verse is illustrated on their whitepaper.
Blockchain Opportunities
But, more intriguingly, there may be possibilities to get paid in cryptocurrency itself, which might have a significant upside if the value rises over time. However, given the markets volatility, it is critical to do research to assess the advantages and drawbacks of going down that path.
Creators may invest directly in different cryptocurrency initiatives, which may be more immediate. Although the great majority of media sources focus on Bitcoin and Ethereum, there are hundreds of other cryptocurrencies in circulation. Dont be afraid to look into other emerging brands, like HUH, since there are many interesting prospects as our digital world becomes more decentralised.
Crypto is at a tipping moment, and influencers and content forerunners are playing an enormous role in educating us on the potential power of a decentralised society. Potentially there may be gratitude for the labour and sacrifices done by many public personalities in order to aid in the education process and usher in a new age of financial empowerment and interconnection.
Crypto Criticisms
Scepticism and criticism are important to keep pushing the limits of this technology so that it can become more scalable and broadly accepted. It is critical to only participate in this market if you are completely at ease. Before going on this trip, always undertake your own research and due diligence.
Learn More About HUH Token Here:
Website: https://huh.social
HUH Official Swap- https://swap.huh.social/
Telegram: https://t.me/HUHTOKEN
Twitter: https://twitter.com/HuhTokenInstagram: https://www.instagram.com/huhToken/
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The Power of Social Influence on Cryptocurrency HUH Token Set to be the Next Shiba Inu - Techpoint Africa
www.thehindu.com
About 71% Indians have low or zero trust in cryptocurrencies, according to a recent survey by LocalCircles. The survey added that 54% do not want the government to legalise cryptocurrencies but want them taxed on par with digital assets held abroad.
The community social network said the survey results were based on 56,000 citizen responses from 342 districts of India, received over the past 15 days.
The Centre plans to introduce a Bill to regulate cryptocurrency and ban all private cryptocurrencies in the winter session of Parliament that begins on November 29. The bill also seeks to create a facilitative framework for creation of an official digital currency to be issued by the Reserve Bank of India (RBI).
As per the survey, families of 87% of the respondents do not have anyone trading or investing in cryptocurrencies and 54% do not want the government to legalise cryptocurrencies but tax them like a digital asset held abroad. About 26% say they should be legalised and then taxed in India, LocalCircles said in a release. The study also finds that 51% of the respondents support India rolling out its own digital currency which is managed by the RBI while 26% are against the same. This indicates that the Central Bank Digital Currency (CBDC) would be a more trustworthy investment, it added.
LocalCircles will be sharing the findings of this study with the senior leadership of Government of India, the RBI leadership and all Members of Parliament such that public feedback on cryptocurrencies can be given the due consideration as laws related to it are finalised, said Sachin Taparia, founder, LocalCircles.
The findings show that the Central Bank Digital Currency is seen as more trustworthy
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Cryptocurrency prices today: Bitcoin, Ether slide as …
Cryptocurrencies have weakened over the past 24 hours due to volatility in the virtual coin market, triggered by weak investor confidence and lack of demand after the recent correction.
Bitcoin, the worlds largest cryptocurrency, was trading at $55,914.94 or 2.64 per cent lower than its price 24 hours ago at 2:00 pm. The market capitalisation of the cryptocurrency decreased to $1.06 trillion and the trading volume over the past 24 hours was $1.52 billion.
Ether was trading at around $4,100 or 2.56 per cent lower than its price 24 hours ago. The cryptocurrencys market capitalisation fell to $481.63 billion and the 24-hour trading volume was $1.10 billion.
From the magazine | The crypto mania
All other popular cryptocurrencies, including Solana, XRP, Cardano, Polkadot, Stellar, Dogecoim, Chainlink, Shiba Inu, Uniswap and Litecoin also fell due to the weak crypto market momentum.
However, a possibility of another bumper rally seems difficult this month, unless there is any major development surrounding the virtual coin market.
Commenting on the cryptocurrency market momentum, Edul Patel, CEO and Co-founder of Mudrex, a global algorithm-based crypto investment platform, said, Over the past 24 hours, the cryptocurrency market remained in a consolidated phase.
The largest crypto by market cap, bitcoin, broke below the support level at $57,000. The altcoins are doing relatively better with Ethereum being able to hold the $4100 mark, he added.
The coming 24 hours would likely remain volatile with bears trying to pull the market lower than the current levels.
Watch | Cryptocurrency: Indian Government to create new bill for the digital currency
Cryptocurrency
Price (US Dollar)
24-hour change
Market cap
Volume (24 Hours)
Bitcoin
55,896.15
-2.89%
$1.06 trillion
$1.52 billion
Ether
4,098.75
-2.54%
$481.47 billion
$1.10 billion
Dogecoin
0.217669
-2.55%
$28.75 billion
$1.05 billion
Litecoin
206.30
-4.22%
$14.27 billion
$89.35 million
XRP
1.03
-1.26%
$103.43 billion
$2.99 billion
Cardano
1.77
-2.00%
$58.14 billion
$135.68 million
DISCLAIMER: The cryptocurrency prices have been updated as of 02:15 pm and will change as the day progresses. The list is intended to give a rough idea regarding popular cryptocurrency trends and will be updated daily.
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Cryptocurrency prices today: Bitcoin, Ether slide as ...
Cryptocurrency Is a Hot Gift Idea This Year. Here Are 5 Things You Should Think About if Its on Your List – NextAdvisor
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Looking for a last-minute holiday gift? Theres an option that lets you sidestep supply chain shortages and potential shipping delays, and only requires a few clicks of a button: cryptocurrency.
After a year thats seen cryptocurrency explode in popularity, you wouldnt be the only person to buy friends and family cryptocurrency for the holidays. One in 10 people are gifting crypto this holiday season, according to a recent survey by BlockFi.
Well-known coins like Bitcoin and Ethereum both hit record highs in November, though they have dropped in price since then. Its become easier for everyday investors to buy digital assets through platforms like Paypal and Venmo, and trade them via apps like Robinhood and popular exchanges like Coinbase. Many of these platforms have made crypto gift giving even simpler, promoting specific features and functionality for their users.
While crypto is a popular unique gift idea this year, there are some things you should consider before giving it as a gift, experts say.
Gifting crypto is a lot like gifting a lottery ticket, for starters. The gift could be a huge success for your loved ones or it could go to nothing, says Grant Maddox, an independent CFP based in South Carolina.
Then theres the question of whether your intended recipient is even interested in crypto. Some people may not want to incorporate cryptocurrency into their portfolio, and see no value in owning it, says Chris Chen, a financial advisor with Insight Financial Strategists in Newton, Massachusetts.
But if you still decide to give crypto as a gift this holiday season, what crypto you choose to give can go a long way toward whether it has potential value to the recipient, or is more of a novelty gift. If youre giving a piece of Bitcoin or Ethereum, I think youre getting closer to actually giving something of value to someone, Chen says. And at that point, its starting to resemble a gift of a share of stock or something.
There are thousands of cryptocurrencies, so youre going to have to decide which youre going to give, and how much. Bitcoin reigns supreme as the crypto of choice for gifting and receiving, with Dogecoin and Ethereum coming in as second and third, according to BlockFis data. But as with any new investment whether youre giving it or receiving it its important to do your research, and understand all of the risks.
As more everyday investors wonder how cryptocurrency might fit into their portfolio, experts recommend sticking to Bitcoin and Ethereum, and following the 5% rule that is, dont contribute more than 5% of your portfolio to risky assets like crypto. Its also recommended to treat it as a long-term investment, but you should never invest in cryptocurrency at the expense of other financial priorities, such as saving for emergencies and paying down high-interest debt.
Heres what to consider if youre giving crypto as a gift this holiday season, or find yourself on the receiving end of such a gift.
Crypto is a high-risk, high-reward investment. In other words, theres a chance your crypto sees big value growth for years to come. But theres just as likely a chance it loses its value entirely, leaving you with nothing but the experience. If youre giving crypto as a gift, you might want to make sure the recipient understands these risks of owning and investing in cryptocurrency.
Just take a look at Bitcoin: It reached an all-time high of over $68,000 in November 2021 after starting the year at just under $30,000. Meanwhile, Ethereum has shot up from about $737 to around $4,000, depending on the day. And it isnt unusual for either of them to lose 15% of their value in an afternoon.
While volatility can be a big downside to gifting crypto, it can equally be an upside depending on your perception of crypto, says Chen. If you got Bitcoin, it could go through the roof or through the floor. There are people out there who say that Bitcoin is the future of Bitcoin and Bitcoin is going to take over. And if thats the case, then the value horizons for Bitcoin are infinite.
As long as youre giving less than $15,000 worth of crypto, it falls under the 2021 gift tax allowance. That means you wont have to worry about any tax implications that come with the gift.
If you give me any crypto that is $15,000 or less, theres no tax implications, says Chen. If you give me crypto that is worth $30,000, then the difference between 15,000 and 30,000 is taxable as a gift, and is taxable to you as the person whos giving it.
Despite the gift tax allowance, recipients may have to pay taxes on their crypto in the future. It depends on the cryptos capital gains or losses when the gift recipient sells or transfers it basically, how much value their holdings gained or lost in a given period. Thats because the IRS treats virtual cryptocurrencies like property for tax purposes, similar to other assets like stocks or gold.
So if you receive crypto as a gift, you may still owe taxes on it even if you sell it immediately after its been given to you, depending on whether its increased or decreased in value.
If your crypto gains value over time, youd experience a capital gain when you sell or transfer it. The amount of time you own it plays a role in how much youll owe in taxes, too. Any crypto held for less than a year is a short-term gain. If you own it for more than a year, its a long-term gain. These differences can affect which tax rate is applied. The tax rate also varies based on your overall taxable income, and there are limits to how much you may deduct in capital losses if your crypto asset loses value.
Of course, there is a bright side to owing taxes related to crypto. If you have to pay taxes, that means that you have made money, says Chen.
The opposite of a capital gain is a capital loss. If your losses exceed your gains, you can deduct up to $3,000 from your taxable income (for individual filers).
If you are a DIY tax filer, refer to the Form 8949 to reconcile your capital gains and losses, and then report them on your Form 1040 tax return using Schedule D. Theres additional information and tools on the IRS website to help you determine your crypto-related tax liability, and how to report it on its website.
Keeping a detailed transaction history will come in handy come tax season, whether you file your own taxes or work with a tax pro. As a new and evolving asset class, expect lots of changes to how crypto is regulated in the coming years, and seek out tax professionals who have experience and familiarity with digital assets for an even smoother filing process.
Once you decide to give cryptocurrency as a gift, youll need to figure out how youre actually going to send it. While cryptocurrency has been a popular gift this year, many people lack information on how to actually do it, according to BlockFis data.
Two common ways to give crypto are through gift cards that can be redeemed for crypto or sending it directly to someone via an exchange from one crypto wallet to another. If you already have a crypto exchange you like, that might be the best place to start since it comes with the benefit of first-person experience that can be shared with your recipient.
But both the gift giver and the recipient will need a crypto wallet or exchange account to complete the transaction, which can be a little more complicated. If youre giving crypto to someone who doesnt already have an account or wallet, theyll need to set one up to receive the gift.
Crypto gift cards involve third-parties that can increase the complexity for both the recipient and the sender. Whatever route you go, take care to understand and share what will be needed of your recipient to successfully receive the gift.
Fees are another thing to consider, which are often charged per transaction, and can differ whether youre the seller or the buyer. There are many different fees depending on which currencies you trade, so its important to understand exactly how and when an exchange can charge you for your crypto transactions.
Coinbase doesnt charge for transferring crypto from one Coinbase wallet to another, for example. But the recipient will be charged a fee if they sell or move their gifted crypto off of the Coinbase platform, which could eat into the value of the gift. The transaction costs are pretty high in general, says Chen.
Crypto has been popular this year, but plenty of people still have no interest or limited knowledge of it. If youre sending cryptocurrency to someone who has never owned the digital currency, you may want to consider whether they will be interested, or if it could just end up unclaimed as is the case with so many gift cards that ultimately go unused.
Theres nothing wrong with giving or receiving crypto, says Chen. You just need to be clear as to what you can do with it.