Friday, October 9, 2020

Following The Law When Dealing With Cryptocurrencies

 gold-colored Bitcoin

(Image Source)


People often view the world of cryptocurrencies as a lawless and unregulated one. It’s well-known that they are used to commit crimes, though the reality of the modern crypto market is that governments are working hard to take control. If you want to make a living or enjoy a hobby buying and selling currencies like this, you need to make sure that you’re following the law. While these currencies can be used completely anonymously, it will be impossible to convert them into regular money without showing your face. This means that you can’t hide out of sight of the rules.


Regular Financial Law


Just like when trading with regular currencies, you need to follow standard financial law when you are dealing with cryptocurrencies. This means that you can’t commit fraud, theft, or break other laws that usually come with money, along with having to follow standard business protocol if you’re making enough money out of your venture. It’s possible to end up breaking federal laws if don’t take this seriously, making it well worth looking for a professional crypto lawyer to work with when you are trading enough to justify it. It’s all too easy to end up getting in trouble if you don’t follow these rules.


Cryptocurrency Taxation


Many governments are looking at cryptocurrencies in a different way to normal money, and this means that the tax you have to pay when you make a profit with them can end up being quite expensive. Capital gains tax can be as much as 50% when you are trading, but you can’t avoid this. Websites like taxbit.com can teach you about the taxes you have to pay on currencies like this, along with helping you when it comes to actually paying them. Of course, though, you need to make sure that you are taking some level of responsibility for this yourself, as it can easily end up costing quite a bit if you take the wrong action.


Buying & Selling


While cryptocurrencies use a blockchain system that makes them hard to trace, it’s important to remember that working as a professional with these resources means that you have to take the right steps when buying and selling. You can make private sales, but it will be much easier to carry out your business legally if you use an exchange to handle transactions. While this means that you will have to pay a few service fees, you will benefit from the support that these companies can offer. Their processes will be handled according to the law in their area, though, and this means that you have to find one that will be following the rules of the country you live in.


Trading cryptocurrencies can be an easy way to make some extra money without having to put loads of effort into it, but it can also become a thriving business if you’re willing to put enough time into it. Of course, you will always have to learn before you can dive into this sort of thing, and it’s worth getting the legal stuff out of the way as soon as you can.


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