A Bull Market for Digital Assets in 2024
A bull market for digital assets is predicted to take place in 2024. However, investors should be aware that the IRS has announced its focus on compliance initiatives related to digital assets, FBAR, and high-income and high-wealth taxpayers during that year.
The Identity of Satoshi Nakamoto Still Unknown
The true identity of Satoshi Nakamoto, the creator of Bitcoin, remains a mystery. The ongoing litigation in the United Kingdom regarding whether Dr. Craig Wright is Satoshi Nakamoto is supported by the Bitcoin Legal Defense Fund. This fund aims to minimize legal obstacles that discourage software developers from actively working on Bitcoin-related projects.
Multiple Claims to Be Satoshi Nakamoto
Dr. Craig Wright is just one of many individuals who have claimed to be Satoshi Nakamoto. The article “The Faketoshi” by Arthur van Pelt explores these various claims.
The Mist Around Dr. Craig Wright’s Identity
There is still uncertainty surrounding Dr. Craig Wright’s identity as Satoshi Nakamoto. However, Judge Mellor has ordered that certain documents be exchanged and served by January 18, 2024, which may shed light on the matter.
Tax Implications for US Taxpayers
If the true identity of Satoshi Nakamoto is revealed and they are a US person with significant BTC wealth, US taxpayers are expected to file Form 8300 with the IRS for any received BTC over $10,000 since January 1, 2024. Noncompliance can lead to civil and criminal penalties.
Cleansing of Bad Actors in the Digital Asset Industry
In 2023, the US digital asset industry saw a removal of bad actors through actions taken against Binance, Coinbase, Terraform Labs, and others. Binance and its CEO pleaded guilty to federal charges and agreed to pay over $4 billion in settlements.
New Wave of Institutional Investment Expected
North American investors and money managers anticipate a new wave of institutional and pension fund investment following the approval of spot Bitcoin ETFs. Several applicants have filed for spot BTC ETFs, with an approval deadline of January 10, 2024.
A Positive Outlook for Bitcoin
Bitcoin’s value saw a significant increase in 2023 after a bear market in 2022. The availability of crypto-focused investment funds with large reserves of cash is expected to contribute to a bullish market. However, the introduction of ETFs may also introduce short-selling pressure.
BRICS Countries’ Multinational Stablecoin Plans
The BRICS member countries, including Russia, Saudi Arabia, the United Arab Emirates, Iran, Egypt, and Ethiopia, plan to launch a common currency for their organization. This currency could be a multinational digital currency backed by assets or gold. BricsTether has already launched a stablecoin backed by a basket of assets.
Potential SEC Oversight for Multinational Stablecoins
The use of Tether’s stablecoin by China has been declared unlawful by China’s top legal watchdog. Additionally, Judge Jed Rakoff in the US District Court for the Southern District of New York ruled that certain stablecoins are securities. This means that BRICS-issued stablecoins could potentially be subject to SEC oversight as securities.
Tax Compliance Initiatives for Digital Assets
In 2024, the IRS will focus on compliance initiatives related to digital assets, FBAR reporting, and high-income and high-wealth taxpayers. Noncompliance can result in severe civil and criminal penalties, as well as exclusion from US markets for institutions.
Hot Take: A Bullish Future for Digital Assets
In 2024, the digital asset market is expected to experience a bull market, attracting institutional and pension fund investments. However, the true identity of Satoshi Nakamoto, the creator of Bitcoin, is still unknown. The IRS is also ramping up compliance initiatives related to digital assets. Overall, the future looks promising for digital assets, but investors should stay informed and ensure they comply with tax regulations.
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