Cryptocurrency trading
The current value, not the long-term value, of the cryptocurrency supports the reward scheme to incentivize miners to engage in costly mining activities. In 2018, bitcoin’s design caused a 1.4 https://formedandfueled.com/ % welfare loss compared to an efficient cash system, while a cash system with 2% money growth has a minor 0.003% welfare cost. The main source for this inefficiency is the large mining cost, which is estimated to be US$360 million per year. This translates into users being willing to accept a cash system with an inflation rate of 230% before being better off using bitcoin as a means of payment. However, the efficiency of the bitcoin system can be significantly improved by optimizing the rate of coin creation and minimizing transaction fees. Another potential improvement is to eliminate inefficient mining activities by changing the consensus protocol altogether.
The blockchain is implemented as an ordered list of blocks. Each block contains a SHA-256 hash of the previous block, chaining them in chronological order. : ch. 7 The blockchain is maintained by a peer-to-peer network. : 215–219 Individual blocks, public addresses, and transactions within blocks are public information, and can be examined using a blockchain explorer.
Bitcoin is also used by some governments. For instance, the Iranian government initially opposed cryptocurrencies, but later saw them as an opportunity to circumvent sanctions. Since 2020, Iran has required local bitcoin miners to sell bitcoin to the Central Bank of Iran, allowing the central bank to use it for imports. Some constituent states also accept tax payments in bitcoin, including Colorado (US) and Zug (Switzerland). As of 2023, the US government owned more than $5 billion worth of seized bitcoin.
Cryptocurrency regulation sec
This lack of trust can lead to further victimization. I’ve seen this with certain types of affinity frauds, especially among immigrant communities, where the perpetrator may appeal to the victims’ closeness to their own community and potentially their suspicion of outsiders.
The SEC’s stance on the securities classifications of cryptocurrencies is based on the principles established by the Howey Test, a legal framework used to determine whether an asset is considered a security. Applying the Howey Test to cryptocurrencies, the SEC has determined that certain digital assets—such as those with clear ownership and control structures and where investor profit-taking depends on the efforts of others—may be considered securities.
FINRA’s study also found an extraordinary amount of crypto-related communications that suggested that FINRA or the SEC endorsed particular assets—not that the SEC simply allowed them to be traded. Here are the significant issues Gluck said FINRA found, a handy list of what not to do as a financial advisor :
The crypto space is rife with cutting-edge legal cases, and advisors have a fiduciary duty to act in their client’s best interests, which means taking all reasonable steps to protect them from financial harm and legal problems. Educating clients about regulatory risks can help them avoid crypto practices that turn out to be scams, frauds, or market manipulation. Gary Gensler, the SEC chair, hasn’t minced words about the problem, saying in 2024 that “the whole field is rife with abuses and fraud.”
But despite such losses in the crypto industry, distrust in the traditional financial system is still driving investors towards crypto. We saw that just a few weeks ago when the collapse of Silicon Valley Bank and questions about the stability of the wider banking system pushed increased interest in crypto assets.
Colorado pastor cryptocurrency
Before engaging in a serious financial venture, seek guidance from our Dual-Licensed Tax Lawyers & CPAs at the Tax Law Offices of David W. Klasing by calling (800) 681-1295. Note: Our expertise is in the tax ramifications of financial decisions, and we do not have experience surrounding the regulatory framework regarding cryptocurrency.
Additionally, failure to report cryptocurrency earnings on your tax returns may result in serious damage to your reputation. While it may not seem serious to some, reputational damage can have long-lasting effects on peoples’ relationships and social standing.
Among the supposedly incurred expenses were luxury items, vacations and home renovations. Regalado admitted to pocketing $1.3 million, justifying part of it as payments to the IRS and renovations ordered by God. In a recorded testimony, Pastor Eli Regalado tries to explain the situation.
Took a chance at a 10 minute consult and was extremely impressed. Atty Klasing, is an honest attorney who gave me great legal advice. Highly recommend for any Tax law question. Mine was about classification of employees and he set me straight. Also, spoke to his assistant James who gave me further info at no extra charge. Nice to see such hard working good-ole boys doing such a great service for the community.
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“We allege that Mr Regalado took advantage of the trust and faith of his own Christian community and that he peddled outlandish promises of wealth to them when he sold them essentially worthless cryptocurrencies,” she said in a statement.
