When Congress is ready, there's a digital currency bill they can pass immediately

From what I hear, the U.S. Congress has been a little busy recently. You may have seen something on the news about that. But a bill introduced last week, with bipartisan support, featuring only 20 lines or so of text, could have an enormous impact on the utility of virtual currencies in our daily lives. It should get passed, when Congress gets back to doing things like that.

The bill would eliminate the burden of paying capital gains taxes on purchases with small crypto values — the ceiling is $200. A previous version of the bill set the threshold higher, at $600.

Some quick background on the need, for anyone who may be new to the sector.

The hybrid nature of digital currencies

Digital currencies, cryptocurrencies, virtual currencies, call them what you will. Some would argue (like, regulators who want to tax owners and users) that they are actually some hybrid of a currency and a security. You can hold them like a stock and hope they go up in value, which is what a broad segment of digital currency enthusiasts are doing. But you can also spend them like money, something not possible with stocks. In fact, you can even buy pizza with Bitcoin, as one programmer learned ten years ago when his 10,000 Bitcoin was worth about 30 dollars. (That’s $93 million today, give or take a few hundred thousand. Hope they threw in delivery.)

Up until now, even making small purchases with Bitcoin or other currencies has forced users into a situation where they would have to calculate the potential gain in value every time they bought anything, and be subject to taxation, as using currencies for purchase was considered a “sale” of that currency. Such a requirement has an obvious chilling effect on anyone hoping to spur the mass adoption of digital currencies as a medium of exchange.

Advocates for change have worked for a revision to the policy that would consider digital currencies a little more akin to foreign currency in this instance of small purchases. Foreign currencies can certainly go up and down in value vs. the U.S. dollar, but we don’t worry about capital gains taxes when we swap them at the Change kiosk.

Clearing up confusion

Titled “The Virtual Currency Tax Fairness Act of 2020,” the amendment would completely exclude from the IRS code the gain derived from “disposition” in a personal transaction, eliminating a friction point in the marketplace. This would go a long way to alleviating one of the many confusing issues that hamper mass adoption. It will also, we believe, help to stabilize the value of digital currencies when more widespread usage confirms how they are valued based on what can be exchanged for them.

There are plenty of other complex barriers that keep digital currencies lagging. Companies like Aeryus can solve some of them. The risk of entering the wrong wallet code to transfer funds… we answer that with our ChainPayments system, because Aeryus ChainPayments works with your contact list. The risk of dealing with unknown or nefarious trading partners… we answer that, because Aeryus has strict KYC and AML policies. Account security risks… we answer that, because we don’t hold your funds, you do. Scalability and environmental concerns… solved, because Aeryus is built to operate across any blockchain including far more scalable and economical Proof of Stake environments, or with any blockchain yet to be invented, thanks to our unique interoperability layer.

We’re doing all we can to spur adoption. But for some of it — like regulatory issues — we need the government’s help. Passage of this lean bill would go a long way toward helping.

Visit Aeryus at: https://aeryus.com
Follow us on all our social media channels to keep up to date on all
things Aeryus!

Join our community on Telegram: https://t.me/Aeryus1
Telegram news channel. https://t.me/aeryusone
Looking for token info? https://aeryus.com/token
Follow us on:
Twitter: https://twitter.com/aeryus_one
Facebook: https://www.facebook.com/AeryusOne
LinkedIn: https://www.linkedin.com/company/aeryus/
Aeryus is currently listed on IDEX: https://idex.market/eth/aer