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HEALTH, WEALTH, AND HAPPINESS |
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| "Eliminate, therefore, any possible tendency to complain of conditions as they have been or as they are, because it rests with you to change them and make them what you would like them to be." - Charles Haanel |
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| Staking Rewards May Not be Taxable by IRS (The Defiant): Crypto investors Joshua and Jessica Jarrett sued the IRS over taxing their crypto staking rewards ... and the IRS, somewhat unbelievably, refunded their tax payment.
But it gets weirder: The couple refused to cash the IRS's check because they want the agency to draw a line in the sand on whether staking rewards are or are not taxable.
Investor takeaway: This is an important point for long-term crypto investors: The case for taxing is that crypto staking rewards are like earning interest income, and interest is taxable. The case against taxing is that freshly-minted tokens are property, not income, and thus should not be taxed.
In plain language, the Jarretts see freshly-minted tokens as a new "product," like a baker's fresh-baked bread. The baker doesn't pay taxes on the bread, until it is sold. Staking rewards are the same.
It's an interesting case, and not one the IRS is likely to rule on anytime soon. In general, however, the more governments come to rely on crypto taxes, the more difficult it will be to get rid of them.
Sometimes, taxes can be your friend. |
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Here's the breakdown of U.S. tax revenue from USAspending.gov. If crypto trading volume is something on the order of $14 trillion, and the U.S. owns around 12% of global crypto wealth, that's potentially $1.7 trillion in additional taxes, or a very large slice of the pie: |
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| If crypto trading volume is something on the order of $14 trillion, and the U.S. owns around 12% of global crypto wealth, that's potentially $1.7 trillion in additional taxes, or a very large slice of the pie.
Investor takeaway: As the government continues to collect taxes on crypto, it will become a major source of revenue, and thus harder and harder to ban.
Remember: it's taxable when you sell it at a profit. It's free when you let it grow! |
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| Hi Everyone,
Shock and awe has gripped the stock market today.
What was once considered a blue-chip tech stock has quite suddenly fallen out of favor with investors.
The parent company of Facebook, Meta Platforms, Inc., crashed approximately 25% at the sound of the opening bell. |
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| The reason for this Meta crash is quite clear. For the first time ever, the social network is actually losing users, while their very expensive play into the metaverse may actually take years to pan out... if it ever does at all.
The rest of the stock market is crashing too, and it's only natural to place some of that blame on Mark Zuckerberg's ambition, even if we know that it's really the fault of Federal Reserve policy makers for "rugging" the markets.
Stock investors are a funny bunch, and many simply don't have the long-term diamond hands HODL mentality that is ingrained in the younger generation. |
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| Taxation is theft
Some DeFi users in the U.S are celebrating today, as the IRS has provided some helpful clarity: |
| First off, this is truly awesome news for everyone who chooses to report their crypto holdings to Uncle Sam.
It'll just make things a lot less complicated and much cheaper.
It's also a lot more in-line with traditional finance and how capital gains are usually taxed.
In a similar update, Nirmala Sitharaman, the finance minister of India, has recently delivered a speech in which she outlined crypto's path to legalization including a 30% tax rate and a "digital rupee" central bank digital currency within the next few years.
All this may sound like awesome news, and it is. But for the hardcore libertarians among us, it's not nearly enough.
Perhaps some other day we can go into it a bit deeper, but my personal belief is that all taxation is theft.
Now, as a licensed portfolio manager, I am quite careful to abide by all rules and regulations.
This includes paying the government a large percentage of my income even though they have not provided any service or infrastructure required to obtain said income. I digress... for now. |
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| Announcing: a new game!
Not sure if you've ever watched other people play a video game before, but it has become a big business, creating more than a few multi-millionaire YouTube streamers, not to mention the multi-billion-dollar platform Twitch.
Today, I'm honored to announce that I have partnered with Ninja Syndicate to advise on Supremacy.game, a spectator-centric NFT-operated video game scheduled for release on Feb. 22.
This is not just play-to-earn, it's watch-to-earn, meaning that users will be able to earn money just by watching the robots fight each other. Similar to The Hunger Games, spectators will belong to factions and teams, and they will have the ability to airdrop goodies into the game. |
| As our team has been elbows-deep in the world of GameFi for several months now, I thought this would be a marvelous opportunity to get some hands-on experience.
To be honest, I've wanted to be part of building a computer game since mastering Age of Empires in my teens, and it's an absolute privilege to see this dream finally coming true.
As a result, I'd like to thank the founders Lan Tran, Alex Dunmow, and John Nguyen for bringing me on, and I want to thank all our readers for giving me the platform to stand on.
See you all in the metaverse!
Have a wonderful weekend. |
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| Mati Greenspan Analysis, Advisory, Money Management |
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This is the latest sign that we are moving toward regulatory clarity. Even U.S. lawmakers are catching the bitcoin bug! |
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Except here you would at least have pizza cutters. |
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| Bitcoin Market Journal is a daily newsletter that makes you a better crypto investor. It is created by Evamarie Augustine, Charles Bovaird, Mati Greenspan, John Hargrave, and Alexandre Lores.
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