How Does The US GOVERNMENT Regulate Cryptocurrencies?

alright ladies and gentlemen welcome back to another video thank you so much for joining me today I want to say I really appreciate it so in this video I'll be kind of covering some basics of the United States I'll be covering four main topics relating to recent incidents regarding cryptocurrencies and cryptocurrency regulation those incidents are the IRS crackdown on cryptocurrency and the IRS regulation of various trading platforms IRS compliancy relating to criminal forfeiture and criminal forfeiture in general relating to Bitcoin I'll be talking about cryptocurrencies in relation to terms of ownership when related to the United States government and the individual citizen of the United States and I'll be talking about personal consumer rights related to cryptocurrency more specifically cryptocurrency mining so I hope that all of you find this interesting as always let me know if you have any questions or if you want to see anything else in particular please keep in mind that I am NOT an expert on these topics but I figured that I would go ahead and compile some information bring some stuff to light that all if you want to hear about and let's go ahead and get started okay so what I want to start with is the IRS crackdown on coinbase okay now if you're familiar join base has essentially been a target of the IRS earlier on in this year because people were essentially trading large volumes of cryptocurrencies holding cryptocurrencies buying selling etc and apparently that is not allowed I guess I honestly think that the IRS is kind of taking a very strict approach with this and I would really love to see the United States government kind of sit back and observe before they get too involved but of course you know the IRS does with the IRS does they are one of the most beloved agencies in the United States I say that as a complete joke and right so they've been cracking down on coinbase okay so here's an article written by – al Shapiro on a coin Telegraph absolutely awesome article I will be linking all of these things that I use as source material for this video so please check him out if you are interested but he goes on to write the coinbase recently notified approximately 13,000 of its customers that it was turning their information over to the United States specifically the IRS coinbase has told those affected that it would be providing their tax payer ID or a social security number name birthdate address and transaction records from 2013 to 2015 to the Internal Revenue Service or the IRS by March 16 2008 teen so really pretty big crackdown here okay and it goes on to kind of detail what exactly you should and shouldn't do when working with the IRS if you are one of the people you know who is actually cited or implicated in this ownership or under the IRS as conditions with coinbase but essentially you know really what he advises and he is an attorney okay or he was a former attorney so this guy really knows what he's talking about he advises that you consult a qualified attorney really to deal with the IRS so he says for example let's say an IRS agent has a couple dozen case files all with a range of crypto tax problems as well as a variety of compliance histories which tax payer do you think they're going to refer for criminal prosecution the one whose tax returns had the biggest adjustment in dollar terms or the taxpayer who was rude to them who lied to them and then who refused to cooperate in the investigation fair or not all too often it's the little things that make the difference especially when emotions are running high so he basically just advises you know in this situation don't be a jerk or anything to these people however they may be a jerk to you but basically be cautious be careful treat them with respect and this is really weird okay this is really weird because cryptocurrency has hiren to been fairly unregulated to my knowledge anyway so it's really interesting that now we're seeing former tax attorneys essentially you know giving tax advice or or information on how to avoid upsetting the IRS when they come for your cryptocurrency accounts okay so really weird strange times that we're living in but you know it could be worse I suppose I don't necessarily like how the IRS is handling this but not entirely sure how they're supposed to go about it either so that's the first topic okay the IRS is auditing coinbase you know they are getting information about specific individuals who have certain trading records and really it's it's kind of touch and go right now okay so I don't like that the whole line I don't think many people do I would like to see them take a more hands-off approach but you know like I said it's really going to come down to people being compliant and dealing with them because guess what people unfortunately I guess we're gonna have to start dealing with the IRS so interesting but not the only piece of news that I have to cover okay so let's move on now to a story about the forfeiture of assets by the United States government and this is actually a case relating to people in Ohio criminals who were creating fake identification and selling these fake IDs for Bitcoin and other forms of currency okay so how did the United States government or the federal prosecutors handle this okay well this articles written by Molly Jane Zuckerman and it's titled US federal prosecutors asked for forfeiture of 500 Bitcoin so you can probably already tell how they handle this okay federal prosecutors are seeking the forfeiture of more than 500 Bitcoin worth about 5.5 million USD seized during the investigation of a group producing fake identity documents according to the Ohio Department of Justice's March first news release a federal grand jury has indicted for people from Ohio from producing and transferring fake driver's licenses and ID cards from different states across the United States along with the Bitcoin prosecutors are also asking for the furniture of more than eight thousand dollars in cash as well as gold and silver coins and bars equal to around two hundred and sixty-five thousand dollars if the prosecutors win the case then the Bitcoin along with the other listed assets will be seized by the United States government okay the United States Garner has previously sold confiscated Bitcoin following criminal contact criminal apartment convictions the US Marshal Service has periodically held auctions for seized crypto assets selling 3813 bitcoins in January of this year the proceeds from selling the 144,000 Bitcoin forfeited from Ross ulbrich F conviction for founding and running the now-defunct online black marketplace Silk Road were equal to around 48 million dollars an average of three hundred and thirty four dollars per Bitcoin if the government had sold the Bitcoin today they would have made over 1.5 and billion dollars this is another kind of strange and gray area that I think is really weird right now okay are all of you okay with the United States government selling off assets in Bitcoin which are technically criminally seized to make money it seems weird to me but it's not entirely unheard of I think that it's kind of strange that they are simply allowed to resell these assets especially for a profit if they are selling them for a profit indeed of course we have to see what really develops with this case further but it's interesting to me that these items were seized these bitcoins were seized and that they are now being held and will be auctioned off okay I want to know where every cent from these auctions ends up okay and I'm not saying that these people who are you know essentially criminals should be able to get away with this but I think it's interesting once again how the United States government is handling these cryptocurrencies involved okay and the Bitcoin involved I would like to know what exactly they're doing with it okay and we're exactly the Perseids go you know who's getting the money how it's being distributed because I think that's extremely important okay if the United States government is going to be allowed to confiscate Bitcoin and resell it at a higher price that's that seems weird to me and I'm sure many of you would probably agree with that so let me know what you think about that also okay let's move on now okay this article discusses tax time related to crypto and who exactly owns that crypto during tax time okay very interesting written by Robert W wood so he goes on say Bitcoin and other cryptocurrencies a property for federal tax purposes that can be painful since just about any transfer property can trigger taxes which is something that we've definitely seen even crypto for crypto swap cannot qualify as a tax-free 1:03 one exchange according to the tax code so that's kind of screwed up in my opinion also the United States government is going start treating cryptocurrency as a property more or less okay and because of that exchanges will most likely be taxed in the future so let's move on let's read a little bit more okay start with the proposition that federal income tax liability is generally allocated based on the ownership under local law the issues can be intensely factual who has to pay can turn on who has control over on benefits and burdens of the property the same thing can happen with bank accounts so essentially the IRS is in this situation I'm going to be treating I think cryptocurrency more as an asset and a property as opposed to a currency itself right which the IRS does regulate currency exchange don't get me wrong okay going on here it says the IRS and the courts often look beyond the local law to impose taxes on the party who is the beneficial owner in one case a man was subject to income tax as the beneficial owner of a bank account even though he was not the owner of the account under local law conversely if you are just holding something as an agent you shouldn't be taxed if someone holds legal title to property as an agent then for tax purposes the principal and not the agent is the owner one tax case put it okay a nominal owner is not the owner for federal income tax purposes so I'll wrap this one up by saying that for tax purposes transfers are treated as sales unless you can find some other way of transferring cryptocurrency tax-free the fact that the Internal Revenue Service marks Kryptos property might prompt you to consider the concept of ownership once again more regulation okay and once again I I'm not super thrilled about that is a huge deal not necessarily okay but it's another tax that's being imposed upon ownership so let's wrap up with a slightly more lighthearted article slightly more okay about the FCC warning a Brooklyn Bitcoin miner of harmful interference to t-mobile so the US Federal Communications Commission has sent an official notice dating February 15th to a resident of Brooklyn New York Victor Rosario citing that his Bitcoin miner was causing harmful interference to t-mobile's broadband network they stated that the device was generating spurious emissions on frequencies for t-mobile's network continued use his aunt minor has found Bitcoin miner in a way that caused harmful interference would be breaking federal laws subject to penalties including but not limited to substantial monetary fines arrests action to seize the offending radio equipment and criminal sanctions including imprisonment so this is serious okay all because this guy was using the a minder s five the notice contains a caveat clarifying that not all aunt minor has five devices generate harmful interference and suggesting the devices originally compliant with federal laws on radiofrequency interference can be modified to make them non-compliant so once again this is weird okay this is really weird and maybe this guy's aunt minor has five was interfering with radio signals but it's very much the case of you know the United States government coming in saying hey you know what you're interfering with radio signals somehow t-mobile is complaining about it and they are being affected so we're going to go ahead and make sure that you never mind again and what if this person was not aware of the radio frequencies okay really interesting stuff right really interesting stuff so anyway unfortunately folks it looks like we're really leaning more and more toward a functioning system that includes more government regulation you know whether people want it or not the IRS is really stepping in now in a pretty big way and they are impacting many people they're enforcing laws they are treating cryptocurrency more as property versus you know a currency or or a different entity and they are really starting to crack down so IRS is auditing people IRS is auditing coinbase it seems like a dark time right I'm sure that will pull out of it and that everything will get figured out but for the time being it is a little frustrating to see all these regulations being put in place and many of them come on the coattails of you know December's cryptocurrency boom honestly when governing bodies really started to take notice so honestly I don't know what exactly is going to continue to happen with this I'm going to guess that we will probably continue to see more crackdowns unfortunately which you know really isn't isn't all that great I'm not too happy about that but the US government is apparently going to keep at it so pretty interesting stuff nothing has been witnessed like this Roy before in the and in the time period before these past ten years or so so it really comes down to how ever you know governing bodies decide to follow protocol that they set up for specific circumstances related to crypto I don't know what they're gonna do exactly it's going to be interesting I think no matter what but let me know it all if you think I want to present these articles do to kind of give you a decent look into cryptocurrency regulation and how exactly it functions and a couple of specific circumstances because I know it's easy to just say hey crypto is being more regulated by the IRS but you know what our specific examples of that and I think it's always important to cite specific examples because honestly if you aren't citing specific examples and you don't know specifically you know what's happening it's really kind of pointless to just their opinions out there so anyway folks I hope you all found this interesting informational let me know if you did thank you all so much for watching and where this video is pretty long but but yeah thank you all again see all of you in the next video and thank you all for watching once again really appreciate it adios

15 thoughts on “How Does The US GOVERNMENT Regulate Cryptocurrencies?”

  1. Essentially, the IRS is acting as the mob, stealing bitcoin from others, selling at a profit to benefit only themselves, which was initially, the same idea of the so called criminal. I'm sure they'll have proof of some "Good deeds" but in the scheme of things, it comes down to theft. So the people need to step up. The gov't works for us, not the other way around. If they prove to be useless to the people, then we dont need them.

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