Bittrex has completed an agreement that allows investors to buy digital coins with American dollars. In the past, only coins traded on Coinbase could be bought with dollars. to buy any of the other coins, investors had to convert their money to bitcoin first. During 2017, this caused unexpected tax liabilities for many investors who were unaware of the tax implications for crypto to crypto trades.
During an interview with CNBC Bittrex founder, Bill Shihara, noted one of the effects this shift can possibly have on the market:
“Since so many alt coins could only be purchased by way of bitcoin, the value of bitcoin and many other digital currencies were closely correlated. The value of those crypto units may now begin to decouple from bitcoin, Shihara said, as more investors transact in dollars.”
The constant theme throughout 2018 in the cryptocurrency and blockchain space has been regulations or lack thereof. Since cryptocurrency is still largely unregulated in the United States, many financial institutions and investors have been cautious about moving into this new exciting market. As we see US based exchanges like Bittrex work with regulators to mature the cryptocurrency market these perceptions for investors may soon change.
Are you looking for a CPA in for cryptocurrency tax help? Give Camuso CPA a call today. We also offer a host of other tax services for your benefit. For more information on how our services can help you, please do not hesitate to give us a call at your earliest convenience. One of our friendly and knowledgeable representatives will be happy to answer any questions that you may have.