Coming with a fresh wave of regulatory developments, the United States Internal Revenue Service (IRS) has proposed new rules regarding the tax policies surrounding the sale and exchange of digital assets by brokers. This configuration, scheduled to come into effect in 2026, aims to bring digital asset reporting in line with that of other assets.
At its core, the proposal details a new form designed to reduce the complexities of tax filings and lessen tax evasion. However, this proposed regulation has raised a few eyebrows, attracting a surge of criticism from prominent figures within the crypto sphere.
Gracing the list of critics is Kristin Smith, CEO of the Blockchain Association, who voiced concerns about the disparity between traditional finance and the growing digital asset ecosystem. Miller Whitehouse-Levine, CEO of DeFi Education Fund, labeled the purposed regulations as confusing, self-refuting, and misguided. Opinions also trickle in from Representative Patrick McHenry who views the proposal as yet another assault on the blossoming digital asset ecosystem by the Biden Administration.
Meanwhile, the crypto industry also detects a legal storm brewing from the SEC’s corner. Recently, Gemini, a popular cryptocurrency exchange, has found itself at the center of a SEC lawsuit and is working fervently to dismiss the claims. At the heart of the row, SEC purports that the Gemini Earn service, which allows customers to lend digital assets, have flouted securities regulations.
In parallel to these regulatory frictions on the home front, international jurisdictions are not without controversies of their own. A proposed ban on finance-related cold calls by the United Kingdom’s Treasury has roused anxieties in many corners. As part of this prospective clampdown, His Majesty’s Treasury has initiated a consultation with stakeholders to gauge the ban’s full impact on business operations and the likely costs that could follow.
What underpins these multi-faceted regulatory developments is the tenuous balance between innovation and security. As digital currencies and blockchain create new paradigms in finance, the regulatory authorities grapple to catch up, often with the fear of stifling advancement in one of the most promising fields of progress and development. Nonetheless, finding the sweet spot between promoting innovation and safeguarding the public continues to be a challenge cryptos yet to decode.
Source: Cointelegraph
